Services activity slows to 11-month low of 58 in December

PMI for December

India’s services momentum eased in December, with the services Purchasing Managers’ Index (PMI) slipping to an 11-month low of 58 in December from 59.8 in the prvious month.

Despite the drop, the index is still comfortably above the 50-mark that separates expansion from contraction.

Even with this moderation, the sector’s performance over the past year underscores its resilience. After starting 2024 on a strong footing — with PMI readings consistently above 60 through much of the first half — services activity dipped briefly in September before regaining strength. The index averaged close to 60 through most of 2025 as well, peaking at 62.9 in August, before easing towards the end of the year. December’s print suggests that the pace has begun to normalise after an extended period of rapid expansion.

The strength of services is even more evident when compared with manufacturing. Factory activity has slowed sharply, with the manufacturing PMI, released on December 2, indicating the weakest pace of expansion in nearly two years. Tariffs and softer global demand have weighed on merchandise exports, dampening manufacturing sentiment and output growth.