Factory Growth: Sept PMI Eases Yet Output Remains Solid; Further Growth Expected

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Factory Growth: Sept PMI Eases Yet Output Remains Solid; Further Growth Expected
Credit: © Reuters.

By Malvika Gurung

Investing.com -- India’s manufacturing activity made a soft landing in September but output, new orders and production increased in the month despite multiple headwinds and zooming recession fears globally.

According to S&P Global (NYSE: SPGI ), India’s factory growth as indicated by the Manufacturing Purchasing Managers' Index (PMI) declined to 55.1 in September, logging a three-month low. The figure stood at 56.3 in August.

The factory activity came in lower than 55.8 estimated by economists in a Reuters poll but the pace of growth remained solid. For the 15th consecutive month, the figure was recorded above the 50-mark, which separates growth from contraction.

According to the survey, September witnessed the best overall level of positive sentiment in more than 7.5 years, as Indian businesses showed more confidence about future output. International demand too, jumped the most since May, led by a weakening rupee which aided robust external demand for goods.

Further, input costs rose at the slowest pace in the month since Oct 2020 and businesses profited from a notable moderation in price pressures, stated the survey.

The Economics Associate Director at S&P Global, Pollyanna De Lima stated that the latest PMI data shows that the Indian manufacturing industry remains in good shape despite considerable global headwinds.

New orders and production have substantially increased in September, with some leading indicators suggesting that output is set to likely expand more at least in the short-term, Lima added.

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