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IHS Markit India Manufacturing PMI at seven months high


The IHS Markit India Manufaturing PMI rose from 51.2 in November to 52.7 in December, pointing to the strongest improvement in the health of the sector in ten months.


The manufacturing output rose at a marked pace in December, the fastest in ten months alongwith renewed upturn in Input buying. Companies that signaled growth commented on securing new work, the successful launch of new products and improved technology.


The uptick in total sales was supported by higher overseas demand. New orders expanded for the twenty sixth month in a row, though modestly.


Growth was led by the consumer goods, though intermediate goods also made a stronger contribution. Meanwhile the capital goods remained in contraction.


Key findings :

  • Output rises at fastest rate in 10 months
  • Sales expand at quickened pace
  • Renewed rises in employment and input buying.


Commenting on the latest survey results, Pollyanna de Lima, Principal Economist at IHS Markit, said: “The uptick in Indian manufacturing sector growth signaled by the latest PMI results will be welcomed by policymakers, particularly given the concerning results observed in October.

Factories benefited from a rebound in demand, and responded by scaling up production to the greatest extent since May. There were also renewed increases in input purchasing and employment during December.

However, a note of caution is evident from the survey’s measure of business confidence. The degree of optimism signalled at the end of 2019 was the weakest in just under three years, reflecting concerns over market conditions, which could restrict job creation and investment in the early part of 2020.

At the same time, price indicators showed accelerated rates of inflation for both input costs and output charges. The latter reflected a combination of improved pricing power, given the favorable demand environment, and efforts to protect margins from cost rises.


The PMI Manufacturing data is released monthly & is a measure of the prevailing direction of economic trends in manufacturing.


The core sector data showed a contraction of 1.5% in the month of November. Though the data shows contraction the magnitude of contraction has slowed down considerably from 5.8% in the month of October.


The slowing of contraction in the core sector and the PMI data released today, do indicate that the economy is on a recovery path.