India's manufacturing PMI hits another new high in August driven by robust production

New Delhi, Sep 1 (IANS) Riding on new orders and strong production, India’s manufacturing sector saw a robust growth in the month of August, with the HSBC India Manufacturing Purchasing Managers’ Index (PMI) rising to 59.3 from 59.1 in July, a report showed on Monday.

S&P Global data showed that the PMI reading signalled the fastest improvement in operating conditions in 17 years and six months. Much of this strength came from domestic buyers, with manufacturers pointing to successful advertising campaigns. In addition to demand buoyancy, survey participants linked growth to advertising success..

The strongest sales and output performances were noted in the intermediate goods category, followed by capital and then consumer goods.

“India’s manufacturing PMI hit another new high in August, driven by a rapid expansion in production," said Pranjul Bhandari, chief India economist at HSBC.

The strongest sales and output performances came in the intermediate goods category, followed by capital and then consumer goods. Surveyed businesses reported higher input stocks, while the finished products inventories also expanded for the first time in nine months.

According to the report, there was a mild increase in international orders placed. Companies also accelerated purchases of additional materials and added more jobs, partly driven by optimism about the business outlook.

Indian manufacturers also continued to expand their workforce, with employment rising for the eighteenth straight month in August.

One factor that supported these positive spending trends was confidence among manufacturers that output would increase over the course of the coming 12 months. The overall level of positive sentiment recovered from July's three-year low, according to the report.

The upward movement in the headline figure largely reflected an acceleration in growth of production volumes, stated the report. The rate of expansion was the quickest in close to five years.

—IANS

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