Manufacturing activity in almost the maximum of 8 years in January: PMI survey
NEW DELHI: Activity in the country Manufacturing sector It shot at a maximum of almost eight years in January as a result of increased demand, adding some encouragement to an economy that is experiencing a sharp slowdown.
The IHS Markit India Manufacturing PMI increased from 52.7 in December to 55.3 in January, its highest level in just under eight years. The consumer goods subsector remained the brightest point, growth remained in intermediate goods and capital goods expanded again.
In January, the growth of new businesses, production, exports, purchase of supplies and employment accelerated. At the same time, business sentiment strengthened and there were smoother increases in both entry costs and exit charges, the survey showed.
The Manufacturing sector has been a worry as it has remained sluggish for a long time. Economic growth is estimated to slow to 5% in 2019-20, its slowest pace in 11 years. The survey showed that companies noted the strongest upturn in new business intakes for over five years, which they attributed to better underlying demand and greater client requirements. A number of firms also suggested that marketing efforts bore fruit.
The results of PMI show that a notable rebound in demand boosted sales growth, the purchase of inputs, production and employment, as companies focused on rebuilding their inventories and expanding their capabilities in anticipation of further increases in new businesses, said Pollyanna de Lima, principal economist at IHS Markit.
Companies also benefited from moderate cost pressures, which allowed them to restrict increases in their rates to some extent, De Lima said.