Man­u­fac­tur­ing Sees Up­turn on Rise in Out­put, Lo­cal De­mand

Mfg PMI at 8-month high of 52.4 in March

The Economic Times - - Economy - Our Bureau

New Delhi: Led by bet­ter do­mes­tic de­mand and in­creased out­put, In­dia’s man­u­fac­tur­ing busi­ness con­di­tions im­proved in March, a pri­vate sur­vey showed on Mon­day. At an eight-month high of 52.4 in March, the sea­son­ally ad­justed Nikkei In­dia Man­u­fac­tur­ing Pur­chas­ing Man­agers’ Index (PMI) pointed to a man­u­fac­tur­ing up­turn. A higher read­ing was reg­is­terd for the index in July 2015.

A read­ing above 50 on this sur­vey-based index shows ex­pan­sion, while a fig­ure be­low that in­di­cates con­trac­tion.

The man­u­fac­tur­ing PMI rose to 52.4 in March from 51.1 over the pre­vi­ous two months. March data high­lighted a third suc­ces­sive monthly rise in or­der books as­so­ci­ated with im­proved de­mand from do­mes­tic and ex­ter­nal clients. New busi­ness in­flows in­creased at a solid pace and one that was the most pro­nounced since last July. “PMI data sug­gests we should ex­pect an­other quar­ter of ro­bust eco­nomic growth in the last quar­ter of the 201516 fi­nan­cial year," said Pollyanna De Lima, econ­o­mist at Markit, the agency that com­piles the index. The sur­vey showed that along with im­proved do­mes­tic de­mand, pro­duc­ers also recorded an in­crease in new ex­port busi­ness. On the price front, cost in­fla­tion ac­cel­er­ated, while charges were raised to the great­est ex­tent since Novem­ber 2014. These pos­i­tive de­vel­op­ments en­cour­aged com­pa­nies to buy more in­puts, but work­force num­bers were left broadly un­changed. Fi­nan­cial ser­vices firm No­mura said this rise is in­dica­tive of an im­prove­ment in un­der­ly­ing trend, pri­mar­ily led by strength­en­ing do­mes­tic or­der de­mand with con­sumer goods re­main­ing the pri­mary driver of growth.

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