Japan services activity eased in January while India's contracted, according to survey data published Wednesday.
The latest survey data from the Japanese service sector signalled that growth was maintained in January, continuing the longest sequence of expansion on record. Concurrent expansions in new business and employment were indicative of broad based growth, though contrasted with a marginal contraction in outstanding business.
The headline seasonally adjusted Business Activity Index posted at a five-month low of 51.2 in January, down from 52.1 in December. Whilst this reading represented a slower rate of business activity growth, the index nevertheless remained above the 50.0 no-change threshold for the fifteenth consecutive month in January, continuing the longest sequence of expansion to date.
Meanwhile, building on the sharp expansions registered in the final quarter of 2013, manufacturing output expanded at the sharpest pace in over 12 years of data collection in January. Consequently, the Composite Output Index increased fractionally, posting at 54.1 in January and signalling a solid expansion.
Up from 48.1 in December to 49.6 in January, the seasonally adjusted HSBC India Composite Output Index indicated a seventh consecutive monthly drop in private sector activity. That said, the rate of contraction was marginal and the weakest in that sequence. Whereas manufacturing production growth accelerated, output at services companies fell again.
The headline HSBC Services Business Activity Index increased from December’s 46.7 to 48.3 in January, signalling a moderate rate of output contraction that was the weakest in the current seven-month sequence of decrease. Panellists cited tough economic conditions, political issues and lower new order levels as the main reasons behind the fall in output.
Service providers reported falling new business received for the seventh month running in January, with respondents commenting on increased competition for new work, deteriorating confidence among clients and weaker underlying demand. Nonetheless, the rate of contraction was slight and the slowest in that sequence. Manufacturing new orders rose at the quickest pace since March 2013. Incoming new work across the Indian private sector as a whole fell, albeit fractionally.
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