Buoyant international demand continues to support growth of total sales and output: PMI

New Delhi [India], July 24 : Operating conditions across India's private sector continued to improve in July, with the latest HSBC 'flash' PMI data showing sharp expansions in total sales, export orders and output levels, according to S&P Global.

On the price front, there were quicker increases in both input costs and output charges.

"While business confidence remained positive, it retreated to its lowest mark in close to two-and-a-half years as some panellists were concerned about competition and inflationary pressures. Subsequently, job creation eased to the weakest rate in 15 months," the PMI report said.

At 60.7 in July, the HSBC Flash India Composite* Output Index - a seasonally adjusted index that measures the month-on-month change in the combined output of India's manufacturing and service sectors - was little-changed from June's final print of 61.0 and therefore signalled another substantial rate of growth.

Moreover, the headline figure remained well above its long-run average of 54.8.

Goods producers registered a faster increase in output than service providers, as the pace of expansion picked up to the strongest since April 2024. There was a softer upturn in services activity during July, though growth remained sharp by historical standards.

The HSBC Flash India Manufacturing PMI - a weighted average of the New Orders, Output, Employment, Suppliers' Delivery Times and Stocks of Purchases indices - rose from 58.4 in June to 59.2 in July, its highest reading in close to 17-and-a-half years and indicative of a robust improvement in the health of the manufacturing industry.

Pranjul Bhandari, Chief India Economist at HSBC, said: "India's flash composite PMI remained healthy in July at 60.7. The strong performance was bolstered by growth in total sales, export orders, and output levels. Indian manufacturers led the way, recording faster rates of expansion than services for all of the three aforementioned metrics. Meanwhile, inflationary pressures continue to heat up as both input costs and output charges rose in July. Finally, business confidence fell to its lowest mark since March 2023, while employment growth moderated to its weakest pace in 15 months."

The HSBC Flash India PMI® is compiled by S&P Global from responses to questionnaires sent to survey panels of around 400 manufacturers and 400 service providers. The panels are each stratified by detailed sector and company workforce size, based on contributions to GDP.

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