India's March Economic Activity Strongest In Eight Months: HSBC Flash India PMI
The Indian economic activities were at its strongest in eight months in March, led by the manufacturing sector, according to the HSBC Flash India PMI.
Buoyant demand conditions fueled growth, with aggregate sales rising at a sharp and accelerated pace. The manufacturing industry led the upturn with the fastest expansions in factory orders and production in nearly three-and-a-half years.
At 61.3 in March, the headline HSBC Flash India Composite PMI Output Index—a seasonally adjusted index that measures the month-on-month change in the combined output of India's manufacturing and service sectors—was inside growth territory for the thirty-second month running. Rising from 60.6 in February, the latest figure indicates the strongest expansion since July 2023.
The HSBC Flash India Services PMI Business Activity Index was at 60.3, compared to 60.6 in February.
HSBC Flash India Manufacturing PMI was at 59, as against 56.9 in February.
Led by the strongest manufacturing output in nearly three-and-a-half years, the composite output index rose quickly. New orders rose at a faster pace than in the previous month, and within that both domestic and export orders showed improved vigour.Pranjul Bhandari, Chief India Economist, HSBC
According to survey participants, efficiency gains and robust consumer appetite, alongside investment in technology and favourable market conditions, spurred sales. New business intakes at the composite level rose for the thirty-second straight month in March. The pace of growth was substantial and stronger than that recorded in February.
Subsequently, businesses stepped up recruitment in March. The pace of job creation was moderate, albeit the strongest in six months. Employment increased at broadly similar rates in the manufacturing and service sectors.
Private sector companies in India recorded a pick-up in price pressures during March, with both input costs and output charges increasing at stronger rates. Amid reports of higher prices for food, metals and plastics, overall cost burdens rose to the greatest extent in seven months. Anecdotal evidence also highlighted labour and transportation costs as sources of inflation. Rates of increase at manufacturers and service providers were at five- and seven-month highs, respectively.
In line with the trend for input costs, services companies signalled a faster increase in output prices than goods producers. Charge inflation slipped to a 13-month low in the manufacturing industry, but quickened to an 80-month high in the service economy. At the composite level, the latest rise was marked and the fastest since last October.
The Flash PMI survey pointed to a renewed improvement in business optimism during March. Goods producers were more upbeat about the year-ahead outlook than service providers, as has been the case since last November.
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