India's manufacturing activity fell to an eight-month low in October, with new orders rising at their slowest pace in a year, a private survey showed.
The India Manufacturing Purchasing Managers' Index stood at 55.5 in October, compared with 57.5 in September, according to S&P Global. A print above 50 means expansion, while a reading below 50 indicates contraction.
Output continued to increase in October, stretching the current sequence of expansion to over two years, the release said. Firms connected the upturn to a healthy intake of new work and favorable market conditions. Although a further increase in new orders was a positive development, October data signalled a deceleration in growth since September. The rate of expansion was the softest in a year, with consumer goods especially affected.
Growth eased to an eight-month low, weighed by competitive pressures and weak demand at some plants. Granular data highlighted a particularly marked slowdown in the consumer goods sub-sector.
The growth of international sales remained historically strong despite losing momentum in October. Those firms that experienced an increase in new orders from abroad reported gains from Asia, Europe, the Middle East and the US.
Ongoing increases in new business continued to spur recruitment efforts among goods producers in India. However, with fewer than 4% of companies hiring extra staff and 95% leaving workforce numbers unchanged, the rate of job creation was slight and the slowest since April.
Business sentiment remained firmly inside positive territory but slipped to a five-month low amid concerns surrounding the path for inflation and demand.
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