Mfg growth hits 4-yr low amid cost pressures
image for illustrative purpose
New Delhi: India’s manufacturing sector growth slowed to a four-year low in March, weighed down by rising costs, weak demand, and disruptions linked to the Middle East conflict, a monthly survey showed on Thursday.
The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) fell to 53.9 in March from 56.9 in February, its lowest since June 2022. A reading above 50 indicates expansion.
Growth in new orders and output, the two key components, eased to their slowest pace since mid-2022, reflecting softer demand and heightened uncertainty.
Input cost pressures intensified sharply, with prices of aluminium, chemicals, fuel, jute, leather, fabric, oil, rubber and steel rising. This marked the steepest increase in over three-and-a-half years. However, firms largely absorbed these costs, leading to a slower rise in output prices and a two-year low in output inflation. Despite the slowdown, external demand remained resilient. Export orders rose at the fastest pace since September, with gains from markets such as Australia, Brazil, Canada, China, Europe, Japan, the Middle East, Turkey and Vietnam.
Employment expanded at the quickest pace in seven months, while manufacturers remained optimistic about year-ahead production.
