2023.10.0307:00:00UTC+00Indian Manufacturing Growth Remains Strong In September

India's manufacturing activity logged a further solid expansion in September, as both output and demand showed substantial rises, the results of the purchasing managers' survey from S&P Global showed on Tuesday.

The manufacturing Purchasing Managers' Index, or PMI, dropped to 57.5 in September from 58.6 in August.

However, a reading above 50 indicates expansion in the sector. The expected score was 58.1.

New orders grew sharply in September on the back of favourable demand trends, positive market dynamics, and fruitful advertising. Nonetheless, the rate of growth slowed in August.

Consequently, output increased substantially at the start of the third quarter, though it was the softest in three months.

There was a slight decline in new export orders from August's nine-month high, but they remained sharp. Indian goods producers gained new business from clients in Asia, Europe, North America, and the Middle East.

A generally stable supply chain helped lower input price inflation to its lowest level in over three years. In spite of this, Indian manufacturers' average prices increased at a solid and faster pace, reportedly due to higher labour costs and strong demand.

There was a general improvement in positive sentiment among Indian manufacturers in 2023, with overall output volumes expected to increase over the next 12 months.

"The solid increase in output charges signalled by the PMI data, which occurred in spite of a notable retreat in cost pressures, could restrict sales in the coming months," Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said.