Strong demand lifts services Purchasing Managers Index (PMI) in January
- IBEF
- February 5, 2026
The services sector in India continued to perform well in January, with strong demand contributing to the growth, as indicated by the latest Purchasing Managers Index (PMI) data. The HSBC India Services PMI for January increased to 58.5 from 58.0 in December, marking the 54th consecutive month of growth and indicating that the services-driven engine of growth in the Indian economy continues to perform well. The growth in new business, an indicator of demand, accelerated at the fastest pace since November, driven by strong domestic demand and increasing orders from countries in South and Southeast Asia. Companies indicated that their increased online presence and aggressive marketing campaigns helped to attract new business, with export orders also improving moderately during the month. However, employment growth remained weak, with employment increasing only marginally above stagnation levels. Inflationary pressures also increased with input prices rising, leading to an increase in service charges by some companies. However, overall business confidence rose to a three-month high, driven by expectations of further improvements in efficiency and new business acquisition.
The services sector performance also contributed to the overall economic activity. The composite India Purchasing Managers Index (PMI), which combines the services and manufacturing PMIs, increased to 58.4 in January from 57.8 in December, driven by strong demand in both sectors. Manufacturing activity also improved modestly, contributing to the positive trend in private sector economic activity. The encouraging PMI data indicates that the Indian economy started the year on a strong footing, driven by continued demand recovery and business optimism. Careful attention to employment and cost trends will be crucial in sustaining the momentum in the coming months.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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