A gauge of India's services sector recovered from a four-month low, led by job creation and new businesses.
The India Services Business Activity Index, compiled by IHS Markit, stood at 57.2 in August compared with 55.5 in July, according to a media statement. A reading above 50 indicates expansion in business activity.
The Composite PMI Output Index stood at 58.2 against 56.6 the month before.
The upturn was attributed to stronger gains in new business, ongoing improvements in demand, job creation and overtime work, the statement said. There was an increase in new business placed with services firms during August. The rate of expansion quickened from July.
There were quicker increases in new business and output in transport, information and communication, and finance and insurance.
The rate of job creation picked up to the strongest in over 14 years.
August data highlighted another increase in operating expenses faced by services companies, with panellists often mentioning higher food, fuel and labour costs. That said, the overall rate of inflation softened to an 11-month low.
The companies sought to protect margins from cost increases by lifting their selling prices in August. In some instances, panel members indicated that revisions were supported by accommodative demand conditions. The overall rate of charge inflation was broadly similar to that seen in July.
Outstanding business volumes at Indian services companies continued to increase in August, taking the current sequence of accumulation to eight months. The rate of expansion was the fastest in a year and a half.
Services companies expect output growth over the coming 12 months, with sentiment rising to its highest level in over four years. Optimism was centered on forecasts of ongoing improvements in demand and planned marketing.
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