India Services PMI Revised Downward

The HSBC India Services PMI was revised slightly down to 58.1 in February 2026 from an initial estimate of 58.4. This was below January’s reading of 58.5 and forecasts of 58.6, yet still signaled another month of robust expansion in the sector. While new order growth slowed to a 13-month low due rising competition, international sales rose at the fastest pace since last August. This led firms to increase hiring, with the rate of job creation surpassing its long-term trend. Meanwhile, services companies faced mild operating capacity pressures, reflected in a second monthly rise in backlogs. Cost pressures also intensified, with input inflation accelerating to a two-and-a-half-year high, driven by higher food prices and increased spending on energy, labour, and commodities. Output price inflation also rose to a six-month high. Nonetheless, business confidence climbed to its highest level in a year as companies sought to expand their presence in both existing and new markets.

The HSBC India Services PMI edged down to 58.4 in February 2026 from 58.5 in January, pointing to a slightly slower but still strong expansion in services activity, preliminary estimates showed. While overall business activity softened marginally, services firms recorded a notable acceleration in new export orders, with international sales rising at the fastest pace since August 2025. However, domestic demand moderated, partly reflecting competitive pressures and cheaper service offerings elsewhere. Stronger export growth and rising backlogs encouraged companies to increase hiring, with employment expanding at a modest but faster pace. On the price front, input costs rose at the steepest rate in two-and-a-half years. In response, firms lifted selling prices at a quicker rate. Looking ahead, sentiment improved, with businesses expressing their strongest optimism in a year, supported by expectations of gains from investment and marketing efforts despite elevated cost burdens.

The HSBC India Services PMI was revised lower to 58.5 in January 2026 from a preliminary estimate of 59.3. However, the latest figure remained above the December reading of 58.0, which marked the softest expansion in 11 months, supported by faster growth in output and new business. Rising new orders prompted service providers to resume hiring staff, though job creation increased only marginally. On the price front, input cost inflation accelerated to a four-month high, driven by higher prices for eggs, electronic items, meat, paper, parts, and vegetables. Meanwhile, selling prices rose at the fastest pace in three months, as firms sought to better balance cost pressures and profitability. Looking ahead, business sentiment improved to a three-month high, supported by optimistic forecasts for efficiency gains, marketing efforts, and new client wins.