December manufacturing growth inches up: PMI

Factory.

New Delhi,(Asian independent)┬áIndia’s manufacturing sector growth inched up in December, as improving business environment pushed order flow.

The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) inched up to 56.4 (index reading) in December up from 56.3 in November.

The PMI varied between 0 and 100, with a reading above 50 indicating an overall increase compared to the previous month.

“Reflecting the loosening of Covid-19 restrictions, strengthening demand and improved market conditions, factory orders increased during December,” said the Manufacturing PMI report said.

“In response, firms lifted production again. In both cases, rates of expansion remained sharp despite easing to four-month lows.”

Besides, the report pointed out that international demand for Indian goods rose in December, but anecdotal evidence suggested that growth was hampered by the Covid-19 pandemic.

Resultantly, new export orders increased at the slowest pace in the current four-month sequence of expansion.

Furthermore, it cited that goods producers continued to make additional input purchases in December, extending the current sequence of growth to five months.

“The latest PMI results for the Indian manufacturing sector continued to point to an economy on the mend, as a supportive demand environment and firms’ efforts to rebuild safety stocks underpinned another sharp rise in production,” said IHS Markit’s Economics Associate Director Pollyanna De Lima.

“It’s important to emphasise the broad-based nature of the recovery, with marked expansions in both sales and output noted across each of the three monitored sub-sectors.”