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BUSINESS / ECONOMY

India’s April manufacturing PMI growth at 8-month-low

Mumbai, May 2 (IANS) The output growth of India’s manufacturing sector remained weak in April as softer increase in new orders restricted production, employment, input buying and business sentiment.

According to the Nikkei India Manufacturing Purchasing Managers’ Index (PMI), the composite indicator of manufacturing performance showed an index reading of 51.8 in April from 52.6 in March 2019.

“This indicated a slight improvement in the health of the sector that was the slowest in eight months and weaker than the average for the 14 year survey history,” the business survey report said.

An index reading of above 50 indicates an overall increase in economic activity, or growth, and below 50 an overall decrease.

Commenting on the survey data, Pollyanna De Lima, Principal Economist at IHS Markit and author of the report, said that April PMI signalled a slight improvement in the health of the Indian manufacturing economy, helped by ongoing growth of new order intakes.

“Although remaining inside expansion territory, growth continued to soften and the fact that employment increased at the weakest pace for over a year suggests that producers are hardly gearing up for a rebound.

“When looking at reasons provided by surveyed companies for the slowdown, disruptions arising from the elections was a key theme. Also, firms seem to have adopted a wait-and-see approach on their plans until public policies become clearer upon the formation of a government,” De Lima said.

“With price pressures in the manufacturing economy cooling and growth losing momentum, it’s increasingly likely that the RBI may cut its official rate for a third successive time in June,” De Lima added.

–IANS

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