Manufacturing PMI stays in healthy zone
New Delhi: India's manufacturing sector continued its healthy performance in May, with the HSBC India Manufacturing Purchasing Managers' Index (PMI) recording a reading of 57.6, it said on Monday.
While slightly lower than April's 58.2, the index remains well above the neutral 50 mark -- signifying sustained expansion in the sector, according to data compiled by S&P Global.'India's May manufacturing PMI signalled another month of robust growth in the sector,' said Pranjul Bhandari, Chief India Economist at HSBC.
'The acceleration in employment growth to a new peak is certainly a positive development. Input cost inflation is picking up, but manufacturers seem to be able to lessen the pressure on profit margins by raising output prices,' she added.The growth was powered by solid domestic and overseas demand, as well as successful marketing efforts that boosted export orders to one of the highest levels seen in the last three years.
Manufacturing companies also stepped up hiring in May.Input costs saw a moderate rise, influenced by items such as aluminium, cement, iron, leather, rubber, and sand, along with freight and labour.In response, manufacturers increased selling prices at a strong pace to maintain healthy margins, the report said.
Despite these price adjustments, business confidence remains high. Manufacturers are optimistic about the year ahead, citing effective advertising, rising customer enquiries, and a supportive domestic market as key drivers of future growth.
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