Manufacturing PMI slips to a 9-month low

Activity in the country’s factories rose at their slowest pace in nine months due to slowdown in output and new orders. The HSBC India Purchasing Managers’ Index (PMI) — a composite gauge designed to give a single-figure snapshot of manufacturing business conditions — dropped from 52.4 in August to 51 in September. But it remained above the 50-point mark for the eleventh consecutive month. The 50-point mark separates expansion from contraction.
The manufacturing sector has been under stress for a significant period and recent data had pointed to a recovery in the sector critical for jobs and growth. The Narendra Modi administration has vowed to revive the manufacturing sector to boost overall growth The survey showed that manufacturing activity expanded for the eleventh consecutive month in September but the pace of growth slowed from August and was moderate overall.
Inflationary pressures from both inputs and outputs eased further in September.
Input costs continued to rise at a solid pace, but the rate of cost inflation decelerated sharply from the prior month.
The survey showed that Indian manufacturers saw new business from abroad grow at an accelerated pace in September. Panel members commented on strengthening demand from key export clients. Marked expansions in foreign orders were reported in the consumer and intermediate goods sub-sectors, while exports fell at producers of investment goods.
Workforce numbers remained broadly stable in September, as the vast majority of survey respondents signalled no change in staffing levels. Among the monitored sub-sectors, job losses in consumer and investment goods were offset by marginal job creation at intermediate goods companies.

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