GET Stock QuotesNews18 APP
News18 English
Powered by cricketnext logo
»
1-min read

Services Activity Slumped in November on Higher Prices: Survey

November's Nikkei/IHS Markit Services Purchasing Managers' Index fell to 48.5 - its lowest since August - from 51.7 in October, well below the 50 mark that separates expansion from contraction.

Reuters

Updated:December 5, 2017, 11:08 AM IST
facebookTwittergoogleskypewhatsapp
Services Activity Slumped in November on Higher Prices: Survey
In this file photo, a waiter carries plates of food for customers at the Britannia and Co. restaurant in Mumbai. (Photo: Reuters/Danish Siddiqui)
New Delhi: Activity in the country's dominant services industry shrank in November as rising prices, driven up in part by the new national sales tax, took a toll on both foreign and domestic demand, a business survey showed on Tuesday.

November's Nikkei/IHS Markit Services Purchasing Managers' Index fell to 48.5 - its lowest since August - from 51.7 in October, well below the 50 mark that separates expansion from contraction.

After initial confusion among firms over the pricing of their products, firms are now better adjusted to the Goods and Services Tax (GST) and are gradually passing higher input costs to end-consumers.

That, however, has hurt demand still recovering from the government's currency clampdown late last year. The survey showed the new business sub-index, a proxy for both foreign and domestic demand, slumped to 48.3 last month from October's 51.5.

Although a sister survey showed factory activity expanded in November at the fastest pace since just before the government's currency ban, a composite PMI, which takes into account both manufacturing and services activity, fell to 50.3 last month from 51.3.

"Hopes of a sustained recovery in November waned as marked growth in the manufacturing sector was broadly offset by a downturn in the service sector," said Aashna Dodhia, an economist at IHS Markit. "Business underperformance emanated from July's Goods and Services Tax which contributed to sluggish demand and lower customer turnout."

Dodhia also said building cost pressures could constrain output growth in the near-term and reduce any central bank appetite to cut interest rates.

Annual consumer inflation was at a seven-month high of 3.58 percent in October and is likely to breach the Reserve Bank of India's 4 percent target in the next few months.

However, halting a five-quarter slide, economic growth rebounded in the three months ending in September, suggesting the RBI will be in no rush to move on rates anytime soon.

A Reuters poll last week predicted the central bank will leave interest rates unchanged at its December policy meeting and through to the end of next year.
Read full article
Next Story
facebookTwittergoogleskypewhatsapp
Most Active
Company Price Change %Gain
Reliance 923.65 +7.50 +0.82
Maruti Suzuki 9,169.00 +35.20 +0.39
PC Jeweller 447.50 +13.75 +3.17
HDFC 1,706.00 -3.95 -0.23
Dr Reddys Labs 2,279.00 +86.10 +3.93
Company Price Change %Gain
Petronet LNG 250.15 -0.05 -0.02
Fortis Health 135.60 -3.30 -2.38
Bharat Fin 991.80 -11.25 -1.12
Max Financial 563.90 +6.75 +1.21
Yes Bank 309.90 -1.60 -0.51
Top Gainers
Company Price Change %Gain
Dr Reddys Labs 2,280.00 +87.10 +3.97
GAIL 492.10 +10.90 +2.27
Vedanta 297.65 +6.30 +2.16
ONGC 181.35 +2.45 +1.37
Lupin 849.00 +9.85 +1.17
Company Price Change %Gain
Dr Reddys Labs 2,278.15 +84.65 +3.86
Lupin 848.55 +10.85 +1.30
ONGC 181.30 +2.40 +1.34
Adani Ports 396.15 +4.20 +1.07
Reliance 922.00 +6.10 +0.67
Top Losers
Company Price Change %Gain
HPCL 419.05 -13.50 -3.12
Bharti Infratel 359.75 -8.30 -2.26
BPCL 502.85 -11.35 -2.21
IOC 395.30 -9.10 -2.25
ITC 260.95 -5.30 -1.99
Company Price Change %Gain
ITC 261.10 -4.50 -1.69
NTPC 175.50 -2.75 -1.54
Bharti Airtel 525.45 -7.05 -1.32
Asian Paints 1,114.55 -13.55 -1.20
TCS 2,629.55 -26.45 -1.00

Live TV

File is:/article-scroll-new.php