Services Growth Hits 6-Month High in May on Strong Domestic Orders, HSBC Survey Shows

India's dominant services sector grew at its fastest pace in six months in May on a pick-up ​in domestic demand, even though global orders stayed below ‌last year's average and business confidence slipped for a second straight month, a survey showed.

HSBC's India Services Purchasing Managers' Index (PMI), compiled by S&P ​Global, rose to 59.8 in May from April's 58.8, ​higher than a preliminary estimate of 58.9. A reading above ⁠50.0 indicates growth. India's services PMI has stayed above ​that threshold since mid-2021.

New business - a key gauge of demand - rose ​to its highest since November 2025 due to e-commerce, entertainment and IT.

Export orders grew, though only slightly after touching a 5-month low in April ​with a U.S. trade deal still pending, creating uncertainty.

Hiring continued, ​though the pace eased slightly, with fewer than 7% of firms surveyed noting ‌new ⁠recruitment, suggesting the headline expansion is not yet translating into broad-based job creation across the services sector.

On prices, input cost inflation retreated for a second month from a 45-month high ​struck in March. ​That gave ⁠firms some breathing room with the prices charged sub-index easing to a four-month low.

Despite headline strength, ​the business outlook index slipped to 61.9 ​from 62.3 - ⁠its second consecutive monthly dip - and was below its historical average, suggesting firms are growing more cautious.

The broader private sector economy ⁠also ​picked up steam with the Composite ​PMI, which combines services and manufacturing, rising to 59.3 in May from 58.2, its ​highest in six months.

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