The service sector is the sector which involves the production of services that are an aid to the primary and secondary sectors .The service sector has been undoubtedly growing all over the country. But in the last six months, the contribution has been in the fast pace.
The December data had highlighted that there has been an improvement in the health of the Indian Service Sector. For the 17th straight month, the headline figure was above the neutral 50 threshold. in purchasing managers index (PMI) parlance, a print above 50 means expansion while a score below 50 denotes contraction.
Economics Associate Director at S and P Global Market intelligence stated” December saw a welcome expansion in Indian Services Activity , underscoring the resilience of demand as 2022 came to an end.”
Further stating, companies have signaled an optimistic outlook towards the outputs in 2023. There were more jobs created in December and companies have remained strongly cheerful for the next year itself .
The Inflationery rates have quickened from November and were above the long run average. Input costs inflation was most acute in consumer services. At the end of the year, firms also increased their selling prices due to increase in business expenses.
De Lima noted in the report “Inflation trends were mixed, a input prices rose at a faster pace and the upturn in charges moderated. On the expenses front, services firms reported pressure from energy , food , staff , and transportation costs. although easing November, the output rate inflation remained elevated as various companies felt the need to transfer escalating costs through to clients”.
There were quicker increases in input costs across both the manufacturing and service economies.