Services activity hits 8-month high: June 2017

Activity in the country's services sector accelerated to an eight-month high in June on the back of new businesses. But it highlighted concerns among some that the GST could dent consumer demand.
The Nikkei India Services PMI business activity index rose to 53.1 in June from 52.2 in May as a solid and accelerated upturn in new work resulted into faster increase in activity. Moreover, job creation was maintained at 47-month record pace set in May. Inflationary pressures gathered speed, with both input costs and output charges rising at faster rates.

In contrast to the trend for services, manufacturing lost growth momentum in June, with the upturn in production moderating for the third month in a row to the weakest since February. The services sector accounts for nearly 60% of the country's economy .

The government does not expect any disruption due to the rollout of GST and is keeping a close watch on prices.

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