Falling to 4-month low, India’s manufacturing sector activity signaled a slightly slower growth in February month, as output and new orders increased at slower rates. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - slowed down to 52.1 in February from 52.4 in January. However, the reading signaled an expansion for the seventh consecutive month, remained above the no-change mark of 50.0.
As per the survey report, total new orders grew for the fourth successive month but at the slower rate. Besides, the employment growth also increased at modest rate but slightly faster rate than at the start of 2018, as firms raised their staffing levels in line with greater production requirements. The firms also raised their purchasing activity, on the back of improved demand conditions but the rate of expansion eased to the weakest since October’s fall and was marginal.
On the price front, rising input costs continued to spark cost pressures on manufacturers and in order to pass on their cost burdens to clients, firms raised output charges thereby extending the period of inflation to seven months. The survey found that the input costs increased for the twenty-ninth month during February, with higher prices seen in the products such as steel, chemicals and fuel, while output price inflation was the sharpest since last February, although it’s modest.