India's private sector expansion slowed in June, with business activity growing at its weakest pace in three months, according to the HSBC Flash Purchasing Managers' Index (PMI) survey. The HSBC Flash India Composite PMI declined to 57.4 in June from 59.3 in May, indicating that economic activity continued to expand but at a slower rate.

The moderation was driven by softer growth across both the manufacturing and services sectors. The manufacturing PMI slipped to 54.5 in June, reflecting a slower pace of factory activity compared to the previous month. Meanwhile, the services sector recorded its weakest growth in 17 months, highlighting a gradual cooling in demand across parts of the economy.

Despite the slowdown, both sectors remained firmly in expansion territory, as PMI readings above 50 indicate growth. Survey participants reported continued increases in output, new business inflows, and employment, although the pace of expansion moderated from recent highs.

Business confidence also weakened during the month. Companies remained optimistic about output growth over the next 12 months, supported by expectations of sustained demand, investment activity, and new business opportunities. However, the overall level of optimism fell to a six-month low, suggesting increased caution among firms regarding the near-term economic outlook.

The latest PMI data indicates that India's economy continues to grow at a healthy pace, although momentum has eased following stronger readings earlier in the year. The moderation in business activity will be closely watched by policymakers and investors as they assess the trajectory of economic growth in the coming quarters.