India PMI Data: Private Sector Output Sees Strongest Expansion In Almost 14 Years

India's private sector reported its third-strongest upturn since July 2010, according to a private survey. May saw the headline HSBC Flash India Composite Output Index—a seasonally adjusted index that measures the change in the combined output of India's manufacturing and service sectors—rise from a final reading of 61.5 in April to 61.7, which indicated the third-strongest rate of expansion in close to 14 years.Although the manufacturing industry continued to lead growth in both sales and output, it was the service economy that was responsible for the latest acceleration in overall economic expansion, the release stated.The HSBC Flash India Manufacturing PMI slipped from 58.8 in April to 58.4 in May.The HSBC Flash India Services PMI Business Activity rose from 60.8 in April to 61.4 in May.Other positive developments highlighted by May's survey included a series-record rise in aggregate exports, the steepest expansion in private sector jobs since September 2006, and a notable improvement in business confidence.On the price front, a faster increase in input costs pushed prices charged for Indian goods and services higher.When explaining the latest increase, survey participants cited successful advertising, efficiency gains, robust intakes of new work, and demand strength. Services firms recorded a sharp increase in business activity, the steepest in four months, while factory production rose at the slowest pace since February.The latest data highlighted further signs of strength in new export orders across both the manufacturing and service sectors. At the composite level, international sales grew at the fastest rate since the series' inception in September 2014.Total new orders meanwhile rose substantially, with the pace of expansion matching that seen in April and therefore among the fastest since mid-2010.Persistently strong increases in new orders underpinned job creation across the private sector. Employment has risen on a monthly basis for the past two years, with May seeing the rate of expansion quicken to the sharpest since September 2006. Another factor that supported the growth of headcounts was an intensification of capacity pressures. Combined across the manufacturing and service sectors, outstanding business volumes rose to the greatest extent in 21 months. In addition to taking on extra staff as a result of rising backlogs, Indian manufacturers also purchased additional materials for use in production processes. Buying levels expanded sharply in May, and at an above-trend pace.Amid reports of higher labour and material costs, input prices across the private sector rose at the fastest pace in nine months. There were mentions that prices for chemicals, food, plastics, electronic components, and electrical items had risen. Aggregate selling prices likewise rose to a greater extent in May. The inflation rate was lower than that seen for input costs, though it outpaced its long-run average. A faster increase in charges was recorded in the manufacturing industry, contrasting with the trend seen for input prices.Finally, the overall level of positive sentiment was at its highest mark in over 11 years..Manufacturing PMI Eases In April, But Still Indicates Strong Expansion

India PMI Data: Private Sector Output Sees Strongest Expansion In Almost 14 Years

May saw the headline HSBC Flash India Composite Output Index rise from a final reading of 61.5 in April to 61.7.

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India PMI Data: Private Sector Output Sees Strongest Expansion In Almost 14 Years

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