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India’s services sector activity eased to a three-month low in June but remained above the neutral level of 50.0, amid stronger increase in new business volumes. As per the survey report, the seasonally adjusted S&P Global India Services PMI Business Activity Index fell at 58.5 in June from 61.2 in May. Further, the S&P Global India Composite PMI Output Index -- which measures both manufacturing and services -- eased to 59.4 in June as against 61.6 in May.

The report further noted that there was a sharp and quicker expansion in intakes of new business at the end of the first fiscal quarter. Positive demand trends, advertising and favourable market conditions were among the reasons for the latest upturn in sales. There was also an increase in new export business during June. The rise was the fifth in successive months, but modest and slower than in May.

The data report also showed a notable increase in prices charged for the provision of services in India. The rate of inflation was marked and the strongest seen in just under six years. The pass-through of greater input and staff costs to clients was the primary factor highlighted by firms for the latest upturn in charges. Although input costs continued to increase in June, the overall rate of inflation softened since May and broadly converged towards its long-run average.