India's factory growth at five-month high in February, cost pressures cool

India's factory activity expanded at a slower pace in September, but remained strong, according to a private survey. The Manufacturing Purchasing Managers' Index fell to 57.5, its lowest in five months, missing forecasts. However, strong demand from both domestic and international markets drove business confidence to its highest level this year.

New Delhi, Jan 3 (PTI) India’s manufacturing sector growth fell to an 18-month low in December amid softer increase in factory orders and output, despite minimal inflation, a monthly survey said on Wednesday. The HSBC India Manufacturing PMI survey, conducted by S&P Global, showed that there were softer, albeit sharp, increase in factory orders and […]

The findings were positive for Asia's third-largest economy, which grew a surprisingly strong 7.6% last quarter, slightly slower than the 7.8% growth seen in the April-June quarter but remaining on track to be the fastest growing major economy this fiscal year.

According to the HSBC India Manufacturing Purchasing Managers' Index (PMI), which is compiled by S&P Global, India's manufacturing PMI fell to 54.9 in December from 56 in November and 55.5 in October.

Indias economic growth is likely to have grown at a rate of 7% in the year to March 2023, matching government expectations. Although this is slower than the previous year, Indias major world economy continues to record impressive growth and remains one of the fastest-growing.

The Manufacturing Purchasing Managers' Index (PMI) compiled by S&P Global stood at 57.8 in June, down from May's 58.7 but still above the 50-mark that separates expansion from contraction.

HSBC Holdings has stated that India's recent economic gains are unlikely to surpass China as the main growth engine of the world economy in the near future. HSBC expects the gap between the two economies to widen, reaching $17.5 trillion by 2028. The bank highlights the difference in consumption and investment trends between the two countries. Although India is expected to contribute significantly to global demand for commodities, consumption, and capital goods, it will take another 18 years for India's investment spending to catch up to China's.

The Manufacturing Purchasing Managers' Index, compiled by S&P Global, fell to 57.5 in September from 58.6 in August. The PMI level has remained above the 50-level mark for 27 straight months.

Two-thirds of the survey’s respondents expect sales and new orders to increase in the second quarter of FY24 faster than in the previous quarter

This surge in growth results from both increased global demand and reduced inflationary pressures.