India private sector growth picks up in August, services offset factory slowdown

India's private sector growth accelerated in August, driven by a strong performance in services that offset a slowdown in manufacturing, according to the HSBC India Purchasing Managers' Index (PMI) data. The composite PMI output index rose to 60.7 in August from July's 60.4, signalling the fastest expansion in three months. A reading above 50 indicates expansion.

The services PMI business activity index climbed to 60.9 from 60.3 in July, marking a three-month high, as new business orders and demand remained robust. In contrast, the manufacturing PMI eased to 56.7 from 58.1 in July, the lowest in three months, with output growth slowing and new export orders dipping. Input cost inflation in manufacturing accelerated to a three-month high, while services firms saw input prices rise at a softer pace.

Job creation across the private sector remained solid, with services adding headcount at the fastest rate in nearly two years. However, business confidence in the services sector slipped to a four-month low, while manufacturers' sentiment improved slightly.