Modi Magic – Services look brighter than they have in years
Modi’s regime has completed a full month recently, and has thrown up some of the best economic data in a while, generating excitement ahead of a budget that is expected to unveil measures aimed at sparking a recovery, after a slump that has seen growth stay below 5 percent for two years in a row.
Services have risen to a 17-month high in June, riding on the back of a robust order flow, a private survey revealed on Thursday. This indicates rising optimism in the sector that has a share of over 60 percent in the economy.
The Finance Minister Arun Jaitley is scheduled to present the budget on July 10th.
The HSBC Purchasing Managers’ Index (PMI) rose to 54.4 points in June from 50.2 in May. This has been the biggest one month rise in four years in the survey-based index that polled responses from more than 350 service providers. The 350 private sector survey participants reported stronger new business inflows and better economic conditions. Output expanded in four of the six monitored categories. Post and telecommunications and renting and business activities were among the top performers.
The survey respondents were also very confident about prospects concerning economic growth, prices, the fiscal and current account deficits, exports, foreign capital inflows and the rupee.
Source: The Economic Times
