India’s manufacturing sector activity rose to a three-month high in November as new orders and exports expanded markedly in the latest month, according to a monthly survey released on Thursday.
Posting 55.7 in November, up from 55.3 in October, the seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index signalled the strongest improvement in operating conditions for three months. The headline figure was also above its long-run average of 53.7.
This is for the 17th consecutive month that the index remained above the 50-point mark, which separates expansion from contraction.
While the PMI is high, official data released on Wednesday revealed that the manufacturing gross value added (GVA) contracted by 4.3% in Q2FY23.
The PMI survey however revealed firms were strongly confident towards growth prospects, with optimism driving another round of job creation and restocking initiatives. Buying levels expanded at a marked and accelerated rate as firms also sought to benefit from relatively mild price pressures. Input cost inflation receded to the joint-weakest rate in 28 months, while charges rose at the slowest pace since February, the survey noted.
“Survey participants were also strongly confident in both the buoyancy of demand for their goods and their ability to further lift production in 2023. The level of positive sentiment recorded in November was the best in nearly eight years,” Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said.
“Companies were also aided by a substantial cooling of cost pressures in November, a factor that prompted them to purchase more inputs and add to their inventories. The overall rate of input cost inflation slipped to the joint-lowest in 28 months.”
Moreover, firms were strongly confident towards growth prospects, with optimism driving another round of job creation and restocking initiatives.
Buying levels expanded at a marked and accelerated rate as firms also sought to benefit from relatively mild price pressures. On the jobs front, the survey said that employment rose solidly, and for the ninth month in a row.
The S&P Global India Manufacturing PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers. The panel is stratified by detailed sector and company workforce size, based on contributions to GDP. Data collection began in March 2005.