April PMI signals second-best gain in manufacturing sector in 42 months
New orders increased at the second-fastest pace in almost 40 months with domestic demand outpacing export orders, the PMI survey showed; manufacturers ramped up hiring at a moderate pace, which was still the quickest since last September
ndia’s manufacturing activity eased in April but still signalled the second-best improvement in three-and-a-half years, as per the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI), which slid to 58.8 from March’s 16-year high of 59.1.
New orders rose at the second-strongest pace in almost 40 months, with domestic demand rising faster than export orders, the PMI survey suggested.
IOutput growth slowed but was still the second-fastest in 42 months.
Bolstered by current and anticipated upticks in demand, manufacturers reported higher condence levels with expectations of higher output a year ahead. Firms added employees at a moderatepace, which was still the quickest since September. However, pressure on capacities remained mild.
Even though input costs rose, producers took input purchases to the highest level since June, and expansion of stock inventories was the third-strongest since early 2005, when the PMI data collection began. Expectations that demand conditions will remain conducive to growth supported inventory-building initiatives, HSBC said.
Price gains were reported for materials like aluminium, paper, plastics and steel, and producers last month raised selling prices at the fastest pace in three months, noting that labour costs had also gone up.
“Higher costs of raw materials and labour led to a modest uptick in input costs, but in£ation remains below the historical average.” said HSBC’s chief India economist Pranjul Bhandari. “However, rms passed these increases onto consumers through higher output charges, as demand remained resilient, resulting in improved margins,” she added.