New Delhi: India’s factory activities slowed down in the month of May 2024 but continued to be in expansionary mode, as per a survey finding published by S&P Global on Monday.
The HSBC India manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, dipped to 57.5 in May this year from 58.8 in the previous month.
A PMI print below 50 means contraction while above it shows expansion in activities.
“The manufacturing sector remained in expansionary territory in May, albeit the pace of expansion slowed, led by a softer rise in new orders and output,” said Maitreyi Das, Global Economist at HSBC.
The private survey noted that companies indicated that working hours had been reduced amid an intensive heatwave which hampered production volumes. Also, it said that new orders rose at a softer pace. International sales, however, increased to the greatest extent in over 13 years.
The survey said, “Goods producers were at their most upbeat about the outlook in nearly a decade, and lifted workforce numbers at one of the fastest rates seen in the survey history. Meanwhile, there were stronger increases in both input costs and output charges.
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 policy-makers.
The response from survey participants indicated that high raw material and freight costs led to a rise in input prices in the month of May this year.
“Manufacturers were only able to pass on a part of this increase to consumers, resulting in a squeeze in manufacturing margins. The positive news is that May recorded the highest level of positive sentiment among manufacturing firms in just under a decade, resulting in increased job creation,” HSBC’s global economist said.
