November Sees India's Manufacturing PMI Surge to 56.0

02 Dec, 2023

November Sees India's Manufacturing PMI Surge to 56.0

India's manufacturing sector demonstrated continued growth in November, with the S&P Global Purchasing Managers' Index (PMI) reaching 56.0, marking an increase from the previous month's figure of 55.5, which was an eight-month low.

The manufacturing sector's performance in November remained above the crucial 50-mark, indicating expansion for the 29th consecutive month. Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, emphasized the sector's robustness, attributing it to firms securing new business, both domestically and internationally.

De Lima highlighted the positive impact on the labor market due to sustained new order growth, indicating upward trends in recruitment. She expressed optimism about the sector's performance as 2023 concludes and projected a strong outlook for 2024, given expanded capacities and increased workloads.

The manufacturing PMI surge follows recent statistics from the Indian government, reporting faster-than-expected economic growth of 7.6 percent in the July-September quarter, with the manufacturing sector registering a 13.9 percent year-on-year growth.

S&P Global attributed the November PMI uptick to a substantial rise in new work orders, fueled by positive demand trends and favorable market conditions. Despite a slower growth rate in new export orders since June, overall manufacturing output increased at an "above-trend pace," leading to continued employment growth.

Of significance to policymakers was the report that input cost inflation in November hit its lowest point in a 40-month period, influencing a seven-month low in selling price inflation. While concerns over near-term price increases were noted in business sentiment data, a softer uptick in output charges was observed in a reduced inflationary environment, according to De Lima.