BENGALURU, July 3 (Reuters) - India's dominant services sector expanded at its slowest pace in 17 months in June as domestic demand ‌weakened sharply and overall new business grew at its slowest ‌rate in over two-and-a-half years, according to a survey that also showed hiring nearly stalling.

• ​HSBC's India Services Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 57.4 last month from May's 59.8, but was slightly higher than a preliminary estimate of 57.3. Readings above 50.0 indicate growth in activity.

• "The loss of ‌momentum points to more ⁠challenging market conditions and weaker demand, particularly at home," said Pranjul Bhandari, chief India economist at HSBC. New business - ⁠a key gauge of demand - rose at the slowest pace since November 2023.

• International demand offered a partial offset with new export orders growing at ​their fastest ​pace in three months.

• With demand ​softening, headcount was barely increased ‌and only around 1% of firms reported taking in additional staff - a marked retreat from strong job creation in April and May.

• Input cost inflation eased to a five-month low as the price of electricity, food, fuel and transportation rose at a softer pace. Firms passed on less ‌of that burden to clients as the ​prices charged sub-index fell to a seven-month ​low.

• Business confidence faded ​to a five-month low with firms citing competition, difficult economic ‌conditions and rupee depreciation as ​concerns, underscoring broader caution ​about global trade uncertainty and financial market volatility.

• The India Composite PMI, which covers both services and manufacturing, slipped to its weakest ​since March as ‌output, new orders and employment all expanded at softer rates across ​the private sector and business sentiment hit a five-month low.

(Reporting ​by Anant ChandakEditing by Shri Navaratnam)