China’s service sector activity rebounds to 51.4 in August, beating forecasts

India's services sector saw a slight acceleration in August, but overall activity remained near its lowest in over four years, according to a survey. The HSBC India Services Purchasing Managers Index (PMI), compiled by S&P Global, increased to 54.1 from 53.3 in July, but was slightly below a preliminary estimate of 54.5. A PMI above 50.0 indicates expansion in activity, though the headline reading was marginally below the long-run average.

New business, the survey's main demand indicator, grew at the second-slowest pace in over four years. While international demand provided limited support, new export orders expanded at a similar rate to July.

Service firms boosted hiring at the fastest pace in 15 months, indicating some confidence remains. However, business confidence was below its long-run average for the second consecutive month, though firms were cautiously optimistic that market conditions and demand would improve. The Reuters poll suggested India's economy grew 6.7% this fiscal year, hindered by high oil prices and a weakening rupee, compared to a robust 7.8% growth in the previous quarter.

Rising costs were noted, with client prices increasing at the fastest pace since March, as firms passed on higher operating expenses. The Composite PMI, combining services and manufacturing, remained steady at 54.3, highlighting the need for quicker services expansion to sustain steady performance, as manufacturing growth fell to a five-year low.