Amid sharp gains in output and new orders, manufacturing sector growth posted a 6-month high since December, a monthly survey showed on Monday.
Amid sharp gains in output and new orders, manufacturing sector growth posted a 6-month high since December, a monthly survey showed on Monday. The Nikkei Markit India Manufacturing Purchasing Managers’ Index (PMI) — an indicator of manufacturing activity — surged from 51.2 in May to 53.1 in June. A reading above 50 signals an improvement, while one below 50 points to a contraction in manufacturing activity. This improvement in manufacturing output was a result of favourable demand conditions including new orders from key global markets, the survey said.
Meanwhile, manufacturing sector growth in India moderated to a three-month low in May amid softer rise in new orders and production. At 51.2, the Nikkei Manufacturing Purchasing Managers’ Index was lower than April’s 51.6 but above the 50 mark that separates expansion and contraction. However, the Indian manufacturing sector, however, stayed in expansion mode for the fifth consecutive month in May.
“India’s manufacturing economy closed the quarter on a solid footing against a backdrop of robust demand conditions, highlighted by the sharpest gains in output and new orders since last December,” said Aashna Dodhia, Economist at IHS Markit and author of the report.
Reflecting greater production requirements, manufacturing firms were encouraged to engage in purchasing activity and raise their staffing levels.
“On the jobs front, the latest survey data pointed to a healthy labour market, with job creation accelerating to the sharpest since December 2017,” Dodhia said.
PMI data for Japan
Meanwhile, Japanese manufacturing activity grew at a slightly faster pace in June, but export orders fell more than initially reported in a worrying sign of the potential impact of a heated trade dispute between the United States and major economies, Reuters reported today. The final Markit/Nikkei survey for Japan on Monday showed the manufacturing Purchasing Managers Index (PMI) was a seasonally adjusted 53.0, lower than the flash reading of 53.1 but still above a final 52.8 in May, Reuters said. The index remained above the 50 threshold that separates expansion from contraction for the 22nd consecutive month. “Japan manufacturing PMI data continue to signal that the sector’s current expansion phase still has legs,” said Joe Hayes, economist at IHS Markit, which compiles the survey.