India's economic recovery stumbles, setting stage for sustained low rates

A contraction in India's services sector deepened as localized curbs to control the virus spread hurt consumer demand and business activity

India’s economy showed signs of cooling in June as the slow easing of localized lockdowns hurt activity, a factor likely to encourage monetary policy makers meeting next week to consider keeping interest rates at record lows to foster a durable recovery.
 

Contractions in both manufacturing and services sectors, which contribute more than two-thirds of India’s gross domestic product, pulled the needle on an overall activity indicator to 5 from 6, a level not seen since February and the first downward shift since May 2020 data. The gauge uses a three-month weighted average to smooth out volatility, and a move left