India's private sector growth lost its momentum slightly in May on weaker increases in total new orders, international sales, employment, and business activity.
The HSBC Flash India Composite Output Index, which comprises indices for the manufacturing and service sectors, slipped to 58.1 in May from 58.2 in the preceding month, according to HSBC Flash PMI data released on Thursday.
The seasonally adjusted index, which tracks month-on-month output across manufacturing and services, remained comfortably above the 50.0 threshold, indicating expansion.
"After retreating in April, input price inflation ticked higher, but firms limited the pass-through of additional cost burdens to clients by lifting output charges to a lesser extent," S&P said, adding that service providers outperformed manufacturers and experienced softer inflationary pressures.
As per the data, the pace of expansion by manufacturers was the second-weakest in close to four years, weighed down by competitive pressures, challenging demand conditions, disruptions to travel, and the ongoing war in the Middle East.
Cost pressures intensified, with input prices rising at the sharpest rate since July 2022.
Growth in export orders saw the weakest growth in 19 months in May.
The HSBC Flash India Manufacturing PMI was down to 54.3 in May from 54.7 in April, its second weakest improvement in the health of the sector in close to four years.
The HSBC Flash India Services PMI Business Activity Index also rose marginally to 58.9 in May compared with 58.8 in April.
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