India’s manufacturing activity eased marginally in December from a 11-month high of November as growth in new orders and output moderated, despite factories cutting their prices. The Nikkei Manufacturing Purchasing Managers’ Index declined to 53.2 in December from 54 in November. A reading of over 50 on this survey-based index indicates expansion, while a figure below that reflects contraction.
The latest PMI reading was the second highest in 2018, lifting the average for the fourth quarter to the highest since the third quarter of 2011-12. Competitive pressures, labour issues and challenging public policies pulled down the growth slightly. December data also brought news of a notable slowdown in input cost inflation, to a 34-month low, which translated into broadly no change in factory gate charges.
The index is based on a survey conducted among purchasing executives in over 400 companies, which are divided into eight broad categories: basic metals, chemicals & plastics, electrical & optical, food & drink, mechanical engineering, textiles & clothing, timber & paper and transport.
Among new export orders with manufactures, investment goods makers led the rise, followed by consumer goods producers.