TOKYO -- The Nikkei India services Purchasing Managers' Index, or PMI, dipped into negative territory in November, in the first contraction in three months, as the country continued to reel from the effects of the new goods and service tax, or GST.
July's GST continued to affect businesses as it led to sluggish demand and lower customer turnout.
The seasonally adjusted business activity index stood at 48.5 in November, off from 51.7 in October.
A reading above 50 indicates economic expansion, while a reading below 50 points toward contraction.
Cost pressures "further intensified at service firms -- fastest inflation since October 2013," said Aashna Dodhia, economist at IHS Markit, which compiles the survey. This "could constrain output growth in the near term and reduce any central bank appetite to reduce interest rates," Dodhia said.
(Nikkei)
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