SERVICES SECTOR CONTRACTS FOR FIRST TIME IN 8 MONTHS IN MAY

NEW DELHI: India’s services activity contracted for the first time in eight months in May as stringent lockdowns imposed to curb the explosive second wave of the pandemic hit domestic business activity and international orders.

Data issued on Thursday by IHS Markit showed India’s purchasing managers’ index (PMI) for services fell to 46.4 in May from 54 in April. A figure above 50 indicates expansion, while a sub-50 print signals contraction.

The manufacturing PMI had fallen to its lowest in 10 months to 50.8 in May, barely managing to remain in the expansion zone, showed data issued on Monday by IHS Markit.

The data analytics firm said service providers struggled in May as the Covid-induced crisis worsened, causing renewed declines in new business and output.

“Firms became increasingly worried about growth prospects, with positive sentiment slipping to a nine-month low. Jobs were shed to the greatest extent since last October,” it said.