Indias Economic Activity At Its Strongest In Seven Months In February: HSBC Flash PMI

The Indian economy continues to strengthen in February, according to the HSBC Flash India PMI, with acceleration evident in both the manufacturing and service sectors. The rise in aggregate output was the quickest since last July, while new orders expanded at the joint-fastest pace in seven months. On the price front, the rate of charge inflation for Indian goods and services receded to the weakest in a year, as companies generally observed a lack of cost pressures. Input prices increased at the slowest pace in three-and-a-half years. The headline HSBC Flash India Composite PMI Output Index—that measures change in the combined output of India's manufacturing and service sectors—rose from a final reading of 61.2 in January to 61.5 in February. The HSBC Flash India Manufacturing PMI rose to 56.7 from 56.5 in January. The HSBC Flash India Services PMI Business Activity Index rose to 62 from 61.8 in January. The HSBC Flash India Manufacturing PMI Output Index rose to 60.4 from 59.7 in January. The latest figure was consistent with a sharp rate of expansion that was the strongest since mid-2023, stated the release. Growth improved in both the manufacturing (five-month high) and services (seven-month high) economies, with survey participants attributing the upturn to buoyant demand conditions, investment in technology, efficiency gains, expanded clientele and favourable sales developments, it said.New orders across India's private sector rose for the thirty-first successive month. As was the case for output, as services firms noted a stronger increase in sales than their manufacturing counterparts. International markets again made a positive contribution to companies' order books, as seen by the fastest expansion in new export work since last September, led by goods. Despite ongoing growth of new orders, private sector companies in India refrained from recruiting extra workers in February. Although outstanding business volumes continued to increase, the pace of accumulation was slight and softer than in January, for both manufacturing and services. The flash data showed a moderation in cost pressures across India. Aggregate input prices rose only slightly, and at the weakest pace in three-and-a-half years. Services companies noted a stronger increase in cost burdens than manufacturers, although slowdowns were registered in each case. Where expenses ticked higher, panellists mentioned greater labour and material (iron, plastics and steel) costs. Spurred by a softer uptick in input costs, a smaller proportion of private sector companies in India hiked their own selling prices during February. As a result, the aggregate rate of charge inflation retreated to a one-year low. The overall level of business confidence slipped from January's four-month high, but remained optimistic towards growth prospects. Positive sentiment was pinned on hopes that market conditions will remain favourable, thereby boosting demand for goods and services and subsequently supporting economic output.

India's Economic Activity At Its Strongest In Seven Months In February: HSBC Flash PMI

The rise in aggregate output was the quickest since last July, while new orders expanded at the joint-fastest pace in seven months.

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India's Economic Activity At Its Strongest In Seven Months In February: HSBC Flash PMI

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