India’s HSBC services PMI expands for first time in nearly a year
Motivated by a spurt in new business, India’s giant services industry stretched for the first time in a year in May 2014. HSBC Services Purchasing Managers’ Index (PMI), accumulated by Markit, climbed to 50.2 in May 2014 from 48.5 in April 2014, the first growth above the 50 mark that splits growth from contraction since June 2103. The rise was mainly reinforced by a bounce in fresh orders and development in client demand. Also a triumph for Narendra Modi has driven anticipations for key economic developments following years of policy paralysis.
Purchasing Managers’ Indexes (PMI) are economic pointers ensuing from monthly surveys of private sector companies. The PMI index (which is based on 5 major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment), is a gauge of the economic wellbeing of the manufacturing sector. A PMI reading above 50 indicates that the sector is expanding, a reading under 50 shows that the output in the sector is contracting, whereas a reading at 50 indicates no change.