Services PMI jumps in Oct on rising demand

Services sector activity in India expanded for the second consecutive month in October, driven up by rising new orders -- the fastest pace since June -- amid positive demand conditions, says a monthly survey. The Nikkei India Services PMI Business Activity rose to 51.7 in October, from 50.7 in September, indicating modest growth in the sector, as the reading remained below the long- run series average of 54.7. In PMI lexicon, a print above 50 means expansion and a score below that denotes contraction.

"The service sector reported the fastest rise in new business since June. That said, these key growth indicators remained relatively muted," said Aashna Dodhia, Economist at IHS Markit, and author of the report. To cater to greater output requirements,

service providers hired more for the second month in succession, but the rate of job creation slowed from September.

The latest services PMI follows the manufacturing one announced on Wednesday, which showed that factory activity in India slackened in October. Accordingly, the Nikkei Composite Output Index rose slightly to 51.3 in October, from 51.1 in September, signalling a slight rate of expansion. "The recovery from the implementation of the GST) in July was sustained in the private sector in October, mainly radiating from service providers,," Dodhia said.

The service sector reported the fastest rise in new business since June. However, rate of job creation slowed down during this period