India's services PMI rises for 20th consecutive month but lower than Feb

India's service sector expanded for the twentieth successive month in March, but the Purchasing Managers' Index (PMI) fell to 57.8 from February's 59.4, data released by S&P Global on Wednesday showed.

A PMI of over 50 denotes expansion in the sector.

"India's service sector built on to the momentum gained in February with further increases in new business intakes and output at the end of the 2022/23 fiscal quarter. However, manufacturing has retaken the mantle as the main driver of growth," said Pollyanna De Lima, economics associate director at S&P Global Market Intelligence.

In February, the service sector PMI was at a 12-year high of 59.4. Earlier this month, data released by S&P showed the manufacturing PMI in India rising to a three-month high of 56.4 in March.

"Input price pressures in the service economy continued to subside, alongside the trend seen in manufacturing. Hence, the aggregate rate of input cost inflation moderated to a two-and-a-half-year low," Lima added.

The agency said that despite rising for the tenth month in a row, services employment grew only fractionally in March. Close to 98 per cent of survey participants left payroll numbers unchanged amid sufficient staff levels for current requirements.

"Weakness was seen with regards to jobs, with broadly no change in employment seen neither in services nor in manufacturing as a general lack of pressure on operating capacities and diminished confidence towards growth prospects prevented hiring activity. More firms in both sectors anticipate no change in future output from present levels," said Lima.