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India's private sector activity expanded at a slightly faster pace in August, with the HSBC Flash India Composite PMI (Purchasing Managers' Index) Output index rising to 54.6 from 54.3 in July, which was a 52-month low, according to the HSBC Flash India PMI report.
The latest reading showed a faster expansion in overall private sector activity. However, it remained the second-weakest since March 2022, indicating that growth continued to be relatively subdued. HSBC said, "India PMI Composite Output Index.... rose to 54.6 in August from July's 52-month low of 54.3". The composite index measures the month-on-month change in the combined output of India's manufacturing and services sectors. Indian companies reported a slightly stronger increase in new order volumes in August. However, the pace of growth remained below the trend seen over recent years. The report said challenging market conditions, competitive pressures and lower customer requirements often restricted growth during the month. The improvement in overall private sector activity was mainly driven by the services sector. The HSBC Flash India Services PMI Business Activity Index rose to 54.5 in August from 53.3 in July. The services sector recorded a modest recovery after reporting its weakest increases in business activity and new work in 53 months in July. Growth in both business activity and new work strengthened in August. The manufacturing sector, however, lost momentum during the month. The HSBC Flash India Manufacturing PMI fell to 52.9 in August from 53.5 in July, marking its third consecutive monthly decline. The manufacturing output index also weakened. The HSBC Flash India Manufacturing PMI Output Index stood at 54.9 in August, compared with 56.4 in July. The report said manufacturing posted its weakest increases in production and new orders in five years. Manufacturing companies reported greater purchasing activity in August, broadly reflecting an increase in total new order volumes. However, the pace of expansion in input purchases slowed to the weakest level in more than five years. The slower increase in input purchases also contributed to softer rates of accumulation of both pre-production and post-production inventories. The decline in the manufacturing PMI for the third consecutive month to 52.9 signalled a historically soft improvement in overall factory conditions. The August data therefore showed different trends across the two major sectors of the private economy. Services activity gained some momentum after a weak July, while manufacturing growth slowed further. (ANI)
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