Covid-19 pulls India's service sector into contraction mode in March: PMI

India's services sector activity contracted during March as the COVID-19 pandemic dented demand, particularly in overseas markets, while public health measures aimed at stemming the outbreak curtailed discretionary spending, a monthly survey said on Monday.
The IHS Markit India Services Business Activity Index was at 49.3 in March, down from February's 85-month high of 57.5, as the new coronavirus pandemic pulled the service sector into contraction.
The headline figure fell by over 8 points, undoing the strong gains in growth momentum seen throughout 2019, the survey said.
In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.
"The impact of the COVID-19 pandemic on India's services economy has not been fully realised yet," Joe Hayes, Economist at IHS Markit, said adding that "the survey data collection (March 12-27) was concluding just as Prime Minister Narendra Modi ordered a complete lockdown of the country".
Hayes further said that "clearly the worse is yet to come as nationwide store closures and prohibition to leave the house will weigh heavily on the services economy, as has been seen elsewhere in the world".

According to panel members, business activity was reduced in response to weaker demand and firms responded by reducing their workforces as intakes of new business were insufficient to maintain payroll numbers.