India services sector grew at fastest pace in May

New Delhi, June 6 (ANI): India's services sector in May grew at its fastest pace in three months, raising hopes of a recovery in a weak economy.

The seasonally adjusted HSBC Service Sector Business Activity Index rose sharply to 53.6 in May from 50.7 in April. The index, which was released Wednesday, is compiled by Markit and sponsored by HSBC, reports the Wall Street Journal.

A figure above 50 indicates an expansion in activity.

HSBC said the services data were a contrast from the fall in manufacturing output, which contracted for the first time in 50 months in May. The survey showed that the composite index, which measures activity in both services and manufacturing, rose to 52.0 in May from 50.5 in April.

Leif Eskesen, HSBC's chief economist for India, said firmer order flows helped boost services output. Moreover, companies were more optimistic about the domestic and global economic outlook, he said.

India's economy grew over 9percent as recently as in the fiscal year ended March 2011. The sharp slowdown since then has raised pressure on the central bank to lower interest rates and help boost growth. (ANI)