India’s manufacturing PMI went down from 54.6 in May to 53.9 in June, weakest since last September, as per ratings agency S&P Global. S&P said in its monthly forecast that while the country’s manufacturing sector witnessed growth on account of robust demand, it was marred by the rise of input costs and inflation concerns.
It said, “Softer increases in production, factory orders, stocks of purchases and employment all dragged down the PMI in June, alongside an improvement in supplier performance which is inverted before entering the calculation.” The agency added that while there was an increase in production attributable to an increase in demand, growth was constricted due to acute inflationary pressures.
According to the agency, June’s PMI data was indicative of a three-month low retreat in purchase prices and output charge inflation. Monitored firms across sectors like chemicals, electronics, energy, metals and textiles reported rise in input costs, which these companies passed on to clients by hiking selling prices.
S&P Global Market Intelligence Economics Associate Director Pollyanna De Lima noted, “There was a broad-based slowdown in growth across a number of measures such as factory orders, production, exports, input buying and employment as clients and businesses restricted spending amid inflation.”
She added, “Companies nevertheless remained very concerned about inflation, a key factor that dragged down business confidence to a 27-month low.”
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