India’s manufacturing PMI hits highest level since October 2020 in May

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Key Points

The S&P Global India Manufacturing Purchasing Managers Index (PMI) surged to a 31-month high of 58.7 in May, with factory orders rising at the fastest clip since January 2021 and producers accumulating inputs at an unprecedented pace thanks to lower costs...

While input costs remained historically mild, S&P Global said its survey of about 400 firms that forms the basis of the index, showed that producers raised selling prices at a solid and quicker rate in May that was the highest in a year.According to [survey] panellists, sustained increases in input costs and a supportive demand environment led them to lift their charges, the firm said.. Overall business confidence levels about growth prospects continued to improve after hitting an eight-month low in March, to hit a five-month high in May, with firms ascribing their upbeat mood to publicity and demand resilience...

Pollyanna De Lima, economics associate director at S&P Global Market Intelligence said the soaring sales captured in the PMI showcased robust demand for Indian goods at home and overseas, which also generated more employment opportunities in May..

While improvements in supply chains and generally subdued global demand for inputs helped curb input price inflation in May, heightened demand and previously absorbed cost burdens translated into a stronger upward revision to selling charges..

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