Manufacturing sector picks up in Nov
NEWDELHI: India’s troubled manufacturing sector made a slight recovery in November after hitting a two-year trough in October, while shedding jobs in the face of a challenging economy, a private survey said.
The headline seasonally adjusted IHS Markit India manufacturing purchase managers’ index (PMI), based on a survey of 400 producers, rose from 50.6 in October to 51.2 in November, the market information supplier said in a statement on Monday. A figure above 50 indicates expansion and below 50 indicates a contraction.
The latest reading indicated only a slight improvement in the health of the manufacturing sector, primarily aided by consumer goods.
“Although business conditions in the Indian manufacturing sector improved in November, the upturn remained subdued compared to earlier in the year and the survey history.
Growth rates for new orders and production were modest, despite accelerating from October’s recent lows, while firms shed jobs for the first time in 20 months and continued to reduce input buying,” IHS Markit said in the statement.
Competitive pressures have impacted the pricing power of companies, too. The survey said there were only slight increases in input costs and output prices halfway through the third quarter of fiscal year 2020. Operating conditions at capital goods makers deteriorated in November. The survey said quoting anecdotal evidence that growth was supported by the launch of new products and better demand, though restrained by competitive pressures and unstable market conditions. Total sales increased for the twenty-fifth month in a row.
The challenging economic condition has affected jobs, too. Subdued sales prevented hiring in November, with payroll numbers declining for the first time in 20 months, the IHS Markit statement said.