New Delhi, Oct 1 (Mayank Nigam) India’s factory activities grew at a slower pace in September this year, with manufacturing Purchasing Managers’ Index (PMI) easing to 56.5 during the month from 57.5 in the previous month, as per a survey released on Tuesday. A PMI print below 50 means contraction, while above it shows expansion in activities. As per the HSBC India Manufacturing PMI compiled by S&P Global, output and new orders grew at a slower pace during September this year. “Momentum in India’s manufacturing sector softened in September from the very strong growth in the summer months. Output and new orders grew at a slower pace, and the deceleration in export demand growth was especially evident as the new export orders PMI was the lowest since March 2023.
Input prices rose at a faster rate in September while factory gate price inflation eased, intensifying the compression on manufacturers’ margin,” said Pranjul Bhandari, Chief India Economist at HSBC. The economist noted that weaker profit growth might have an impact on companies’ hiring demand as the pace of employment growth slowed for a third month. The survey said that for the third straight month, rates of expansion in factory production and sales receded in September this year. Further, it said that international orders rose at the slowest pace in a year and a-half during the month. “Despite this loss of growth momentum, net employment and quantities of purchases rose, while business confidence was broadly aligned with its long-run average. On the price front, there were moderate increases in input costs and selling charges,” it said. The HSBC India Manufacturing PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers. It is one of the closely watched high-frequency data by economists, markets, and policymakers.