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regular-article-logo Tuesday, 23 April 2024

Early signs of slowdown: India's Manufacturing PMI growth eases to 57.5 in September

It is the 27th straight month of the index being above the 50-mark separating expansion from contraction

Our Special Correspondent New Delhi Published 04.10.23, 10:32 AM
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India’s manufacturing industry showed mild signs of a slowdown in September, primarily due to a softer growth in new orders, according to a private survey.

The India Manufacturing Purchasing Managers’ Index stood at 57.5 in September compared with 58.6 in August, according to S&P Global. A print above 50 means expansion, while a reading below 50 indicates contraction.

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It is the 27th straight month of the index being above the 50-mark separating expansion from contraction.

New orders, the largest sub-component of the index, rose at a softer pace in September. The latest increase was, however, sharp and historically strong, the survey said. Where an expansion in sales was reported, survey participants cited favourable demand trends, positive market dynamics and fruitful advertising.

“India’s manufacturing industry showed mild signs of a slowdown in September, primarily due to a softer increase in new orders which tempered production growth,” said Pollyanna De Lima, economics associate director at S&P Global Market Intelligence.

“Nevertheless, both demand and output saw significant upticks, and firms also noted gains in new business from clients across Asia, Europe, North America and West Asia.”

On the inflation front, supply-chain conditions were broadly stable, which helped to drag down the rate of input price inflation to its weakest in over three years.

However, greater labour costs, upbeat business confidence and buoyant demand facilitated a sharper increase in output charges.

“While robust demand was supportive of production growth, it added to price pressures in September. The solid increase in output charges signalled by the PMI data, which occurred despite a notable retreat in cost pressures, could restrict sales in the coming months,” Lima said.

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