India’s economic activity sent mixed signals in February, according to key data released today.
- The Services Purchasing Managers’ Index (PMI) dipped slightly to 60.6, indicating a slower pace of growth in the service sector compared to January’s 61.7. However, a reading above 50 still points to expansion.
- On the positive side, consumer inflation, as measured by the Consumer Price Index (CPI), fell to a two-year low of 5.03%. This is below the Reserve Bank of India’s (RBI) target of 4% (+/- 2%), offering some relief to consumers facing rising prices.
Experts believe these figures paint a picture of an economy navigating a delicate balance.
- The slowdown in services could be a concern, as this sector is a major driver of job creation in India. It might be worth watching if this trend continues in the coming months.
- The drop in inflation is encouraging, providing some breathing room for both households and businesses. However, it’s crucial to monitor if global factors like the ongoing war in Ukraine put upward pressure on prices again.
Overall, the Indian economy is showing signs of both resilience and potential challenges. The coming months will be crucial in understanding the trajectory of India’s economic growth and inflation.
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