Activity in India’s services sector contracted in November for the first time in three months because a rise in prices kept foreign and domestic demand subdued. The monthly Purchasing Managers’ Index (PMI) for the services sector, released on Tuesday by IHS Markit, fell to 48.5 from 51.7 in October.
A reading below 50 denotes a contraction in activity.
Despite the decline, the composite PMI – which takes both the manufacturing and services sectors into account – showed a rise because of a 13-month high expansion in the manufacturing sector in November. The composite PMI was 50.3, which, though lower than the 51.3 in October, was still in the expansion zone.
A related survey by IHS Markit had shown on Friday that the manufacturing sector expanded in November, as economic activity continued to recover after the lull caused by demonetisation and the rollout of the Goods and Services tax regime. The manufacturing PMI was at 52.6, against 50.3 in October.