India services PMI slips to 11-month low in Dec 2025 as new orders ease

India's services PMI eased to 58.0 in December 2025 as growth in new business slowed, though companies reported stronger export orders from Asia, North America, the Middle East and the UK

India’s services sector expanded at its slowest pace in 11 months in December 2025, with the HSBC India Services Purchasing Managers’ Index (PMI) easing to 58.0 from 59.8 in November, according to data compiled by S&P Global.

 

Despite the moderation, growth remained strong, with the index staying well above the neutral 50 mark. A reading above 50 indicates expansion, while one below 50 signals contraction. A reading of exactly 50 denotes no change.

 

Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said, "While India's service sector continued to perform well in December, the retreat in several survey indicators as 2025 ended may suggest a moderation in growth heading into the new year."

 

 

"What bodes well for the outlook is the benign inflation environment. If services firms continue to see only mild increases in their expenses, they should be better positioned to compete and limit price hikes, thereby boosting sales and creating more jobs," De Lima added.

Why did new orders slow in December?

New business continued to grow but at the weakest pace in 11 months. Companies said demand was supported by competitive pricing and steady client interest, but growth was constrained as customers had more options, including lower-cost service providers.

Exports improved in December 2025

Overseas demand strengthened further in December. Services firms reported higher export orders, particularly from Asia, North America, the Middle East and the UK. New export business grew at a faster pace than in November.

 

“Companies did express some anxiety about market uncertainty and exchange rate movements. While recent rupee weakness may have driven import costs higher, it likely made exports more competitive. Notably, against the wider trend of slowing growth, services exports rose to a greater extent in December,” De Lima said.

What happened to jobs?

Hiring activity stalled in December. Most firms kept staffing levels unchanged, while a small number reported marginal job cuts. Companies said there was limited pressure on operating capacity, reducing the need to add workers.

 

Services firms remained optimistic about growth in 2026, but sentiment weakened for the third consecutive month. Overall confidence fell to its lowest level in nearly three-and-a-half years, weighed down by market uncertainty and concerns over currency movements.

What does the composite PMI show?

The HSBC India Composite PMI eased to 57.8 in December 2025 from 59.7 in November, marking its lowest level since January 2025. The reading reflected softer growth across both manufacturing and services.

 

Job creation across the private sector stalled, while input costs and output prices rose only mildly. Businesses remained positive about future growth, though overall confidence slipped to a 41-month low.