Thursday, 21 February, 2019

Services sector sees fastest growth in 3 months in January: PMI survey

Services sector sees fastest growth in 3 months in January: PMI survey Services sector sees fastest growth in 3 months in January: PMI survey
Nellie Chapman | 05 February, 2018, 19:58

Dodhia also said that though the service providers were able to pass on a good proportion of their cost burdens onto the customers, the input cost inflation has been weak across the service sector by historical standards.

The Markit/Nikkei Japan Services Purchasing Managers Index (PMI) rose to 51.9 on a seasonally adjusted basis, from 51.1 in December. "Demand for transport and communication services was down for the second straight month".

The index remained above the 50 threshold that separates expansion from contraction for the 16th consecutive month. The index stood at 50.9 in December 2016.

Hiring continued at a robust pace, suggesting a positive pipeline of new projects and positive output expectations, Markit said.

Also, the firms did not receive timely payments alongside which the job-creation rose to the second largest over the last six-and-a-half years.

The upbeat findings, which echoed those of an official gauge of the non-manufacturing sector last week, bode well for Beijing's longer-term goal of overhauling and modernising its economic growth model.

"The recovery across India's service sector continued during January, with growth in output picking up to the joint-strongest since June 2017 as underlying demand conditions improved", said Aashna Dodhia, Economist at IHS Markit, and author of the report but cautioned that the overall performance of the service sector remained weaker than the long-run growth trend.

Recent strong economic data boosted hopes that the Bank of England (BoE) would be pressured into raising interest rates again in the near-term, but this month's trio of below-forecast PMIs has derailed upbeat hopes for the United Kingdom economy and softened the chances of interest rate hikes this year.

Samuel Tombs, chief United Kingdom economist at Pantheon Macroeconomics, examined the data's relevance to the Bank of England's current interest rate policy stance.

The pound was broadly flat, up a shade against the dollar to $1.4119, but down a similar small fraction versus the euro at £0.8825.