Lockdown pulls India’s service sector activity to standstill in Apr; PMI hits record low - Bulletin Mail

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India’s services sector activity became historic in April, as restrictions on citizen movements and business closures caused the sector to halt, a monthly survey said on Wednesday.

IHS Markit India’s Business Activity Index stood at 5.4am in April, a sharp decline from March 49.3, and the worst indication of contraction in service output since a record since December 2005.

As per the IQ Markit India Services Purchasing Managers’ Index (PMI), prints above 50 indicate expansion, while scores below indicate contraction.

According to the panelists, the activity was down due to a national lockdown, so that businesses stopped operating due to a fall in demand.

“The extreme slump in the index index, which dropped more than 40 points, shows that stringent key measures have led the sector to a complete shock,” said Joe Hayes, an economist at IHS Markit.

Meanwhile, the Composite PMI Output Index, which measures combined services and manufacturer output, decreased to 7.2 in April from 50.6 in March, marking the worst contraction in economic activity since data collection since late 2005, Hayes said.

In addition, international sales dropped on the whole survey panel in April, marking their respective indexes down 0.0.

According to the firm, measures to prevent the spread of the virus overseas have caused demand to fall in all major export markets.

“Historical comparisons with gross domestic product (GDP) data show that the Indian economy is contracted on an annual average of 15 cents.

“It is clear that the economic damage to the COVID-19 pandemic is now deep and deep in India, but the hope is that the economy will survive the worst and things will start to happen as key measures continue to expand.” Mr Hayes said.

When it comes to the workforce, the study says that when it comes to business requirements, some service companies reduce their jobs at the start of the second quarter.

“While the rate of decline in labor was a survey record, approximately 90 percent of respondents reported unchanged labor numbers,” the survey said.

On the home front, the survey said input and output prices were down compared to March, although their deflation rates were stronger among manufacturers than service providers.

Previously, the latest survey data provided erosion of business confidence in April. Expectations for output will rise for the second to weakest month since December 2015, the survey said.

Close the national key to contain the spread of coronavirus infections starting March 25th.

The number of COVID-19 cases in India rose to 49,391 in the country on Wednesday, and the death toll was 1,694, according to the Ministry of Health.

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