According to the S&P Global Purchasing Managers’ Index (PMI), India’s manufacturing activity climbed at the slowest rate in five months in September, but it remained strong, with strong demand lifting business confidence to its highest level this year, despite heightened inflationary pressures. S&P Global’s Manufacturing Purchasing Managers’ Index (PMI) was 57.5 in September as opposed to 58.6 in August, falling short of Reuters’ forecast of 58.1. This was the 27th month in a row that the index was over the 50-point threshold that separates growth from contraction.
Although Indian manufacturers of goods saw a little slowdown in growth in September, steady increases in production, input spending, and employment were supported by a significant jump in new orders. The supply chain was mostly steady, which contributed to the rate of input price inflation falling to its lowest level in more than three years. However, higher labor expenses, positive company confidence, and strong demand allowed for a more significant increase in factory gate prices, according to the poll.
The largest sub-component of the PMI, new orders, climbed at a slower rate in September, according to the most recent PMI report. However, the most recent growth was notable for its sharpness and strength. According to S&P Global, the survey respondents attributed the increase in sales to favorable demand trends, favorable market dynamics, and successful advertising.
The survey also emphasized that despite August’s nine-month high, the rise of new export orders was still rapid. Businesses reported gaining new clientele from Asia, Europe, the Middle East, and North America.
S&P Global said that at the conclusion of the second fiscal quarter, production growth was still being supported by continuous increases in new orders. Production increased at the slowest rate in five months, but it was still much higher than the long-run series average, according to the report.
The report also stated that manufacturers were sure that output volumes will rise over the course of the upcoming year, with total optimism rising to its highest point in 2023 thus far. India’s inflation decreased in August from July’s 15-month high of 7.44 percent to 6.83 percent, although it still exceeded the RBI target range of 2 to 6 percent.
