BackManufacturing PMI slows in Feb
The S&P Global India Manufacturing Purchasing Managers’ Index (PMI) fell to 55.3 in February from 55.4 in January, as factory orders and production rose, albeit at a slower rate, the survey showed.
PremiumNEW DELHI : India’s manufacturing sector expanded at the slowest pace in four months in February but remained relatively robust amid strong underlying domestic demand despite inflationary pressures, according to a survey by S&P Global.
The S&P Global India Manufacturing Purchasing Managers’ Index (PMI) fell to 55.3 in February from 55.4 in January, as factory orders and production rose, albeit at a slower rate, the survey showed. The PMI reading has remained above 50, the mark separating expansion from contraction, for 20 straight months now.
“India’s manufacturing industry sustained robust growth of output and new orders halfway through the final fiscal quarter, albeit with a notable slowdown in the rate of international sales expansion," the report said.
The rise in international sales was the weakest in the current 11-month period of expansion, implying that the domestic market was the main source of new business growth.
According to the report, companies continued to scale up input purchases, while job numbers expanded only fractionally amid a general lack of pressure on operating capacities. Meanwhile, input cost inflation accelerated to a four-month high, but there was a softer upturn in selling prices, the report said.
“Companies were confident in the resiliency of demand and continued to add to their inventories by purchasing additional inputs," said Pollyanna De Lima, economics associate director at S&P Global Market Intelligence.
“After slipping to a 26-month low last November, input cost inflation surged in every month since. The latest rise was historically subdued, however, and among the weakest in around two years, “she said. “The survey showed some reluctance among manufacturers to pass on cost increases to clients, with output charge inflation easing since January," De Lima added.
Firms were also reluctant to hire, and job creation was only marginally up during the month.
“Job creation failed to gain meaningful traction, however, as firms reportedly had sufficient staff to cope with current requirements," said De Lima. Input costs in the manufacturing industry increased further, with higher prices for electronic components, energy, foodstuff, metals and textiles.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
