Manufacturing Activity Rises PMI Output Index to 60.7 in July
Manufacturing boosts growth as services stay strong; inflation and jobs show some strain
New Delhi: Driven by the manufacturing sector in the country, India’s business activity accelerated as the headline HSBC Flash India composite PMI output index rose to 60.7 in July from 58.4 in June. Besides, the services sector also continued to grow despite the pace of expansion softened, but it remained sharp by historical standards, a private survey showed on Thursday.
The jump in manufacturing activities is significant as the survey came despite business confidence falling to its lowest mark since March 2023, and employment growth moderated to its weakest pace in 15 months. The PMI is an economic indicator that measures overall business activity across both manufacturing and services tracking production, new orders, employment, supplier performance, and inventories, based on responses from purchasing managers.
A reading above 50 signals growth, while below 50 indicates contraction, and a score of 50 points to no change in activity. “Flash PMI signals expansion as manufacturing activity picks up climbing to 60.7, while the flash services PMI eased to 59.8 in July from 60.4 in June,” showed HSBC’s flash purchasing managers’ index or PMI compiled by S&P Global, Thursday.
Commenting on the survey, Pranjul Bhandari, the chief economist at HSBC India, said that India’s flash composite PMI remained healthy in July at 60.7. “The strong performance was bolstered by growth in total sales, export orders, and output levels. Indian manufacturers led the way, recording faster rates of expansion than services for all of the three aforementioned metrics,” he said.
“Meanwhile, inflationary pressures continue to heat up as both input costs and output charges rose in July. Finally, business confidence fell to its lowest mark since March 2023, while employment growth moderated to its weakest pace in 15 months,” Bhandari added.
