India’s manufacturing growth falls most in 25 mths, China’s hits 3-yr low: Survey

NEW DELHI: India’s manufacturing sector grew at its weakest pace in over two years in November as demand and output continued to soften, a business survey showed on Tuesday.

Nikkei’s Manufacturing Purchasing Managers’ Index (PMI), compiled by Markit, fell to a 25-month low of 50.3 in November from October’s 50.7. A reading above 50 indicates expansion. The output sub-index fell to 50.4 from 51.2 the previous month as domestic demand remained weak.

Manufacturing activity in China hit a three-year low in November, supporting the case for more accommodative policies as authorities seek to prop up growth in the world’s second largest economy.

China’s National Bureau of Statistics’ official PMI hit 49.6 in November, its lowest reading since August 2012 and down from the previous month’s reading of 49.8.

India’s manufacturing sector slum also marks the fourth consecutive month of decline in the rate of the country’s manufacturing output growth.

“The latest PMI data showed slower increases in incoming new business and output, while subdued demand growth led firms to keep workforce numbers broadly unchanged,” as per the survey. The input cost inflation at the same time accelerated to the strongest since May, whereas factory gate prices were raised at a weaker rate that was marginal overall.

Among sub-sectors, consumer goods was the best-performing category, while operating conditions at intermediate goods companies deteriorated for the first time since December 2013.

Pollyanna De Lima, economist at Markit, said the November PMI data points to tepid manufacturing growth across India, with gloomy domestic demand resulting in the weakest expansion in production for 25 months.

Signs of the sector slowing have been building up, as growth of both new orders and output has eased in each of the past four months, Lima noted.

REUTERS & PTI