India's manufacturing PMI hits 31-month high; reaches 58.7 in May vs 57.2 in April

India's manufacturing Purchasing Managers' Index (PMI) hit 31-month high in May. The seasonally adjusted PMI rose from 57.2 in April to 58.7 in May. S&P Global attributed the rise in manufacturing PMI to a strong increase in new orders in its release. 

The release further stated monitored companies indicated better supply-chain conditions and sustained increases in input purchasing boosted inventory growth. It added Indian manufacturers raised production volumes as a result of growing new orders and favourable market conditions.  

S&P Global said: “Not only did factory orders increase for the twenty-third month running in May, but also to the greatest extent since January 2021. Firms generally associated the upturn with advertising, demand strength and a favourable economic climate”.  

The release also stated exports played a key role in rising orders in May as companies saw an uptick in international sales in the last 6 months.  

S&P Global Market Intelligence Economics Associate Director Pollyanna De Lima said that the rise in manufacturing sector activity PMI indicates robust demand for Indian products in domestic and international markets.  

De Lima added: “While the upturn in domestic orders strengthens the foundations of the economy, rising external business foster international partnerships and boost India's position in the global market. Combined, they also generated more employment opportunities in May.” 

She also said that the record increase in input stocks should allow firms to migrate potential disruptions, maintain a steady flow of production and demonstrate the industry’s resilience when faced with challenges.  

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