India’s service activity falls for three straight months, outlook turns negative
India saw a contraction in its service activity in July following COVID-19 restrictions’ blow on demand. Meanwhile, companies are turning the most pessimistic on a year.
Services Purchasing Managers’ Index climbed 45.4 in July from June’s 41.2. The figure was sharply below the 50 mark, indicating a contraction in three consecutive months.
Overall demand in the sector slowly dwindled last month, while overseas demand fell for a 17th month.
The labor market is expected to take a long time in reaching pre-pandemic levels as firms were forced to cut headcounts for eight months.
Meanwhile, business outlook turned pessimistic for the first time since July last year.
IHS Markit economics associate director Pollyanna De Lima said concerns over COVID-19, inflationary pressures, and financial troubles dampened business confidence in July.