Manufacturing Activity Gathers Pace In May: HSBC PMI

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Manufacturing activity gathered pace in May with production and new orders rising to the fastest level since the beginning of the year.

Up to a four-month high of 52.6 in May, from 51.3 in April, the seasonally adjusted HSBC India Purchasing Managers' Index (PMI ) signalled a further improvement in business conditions.

Manufacturing Activity Gathers Pace In May: HSBC PMI
Furthermore, gains were seen in all three monitored sub-sectors. Manufacturing output increased for the nineteenth month running, with the rate of growth marked and the fastest since January. The sharpest rise was reported by consumer goods producers. Solid increases were also seen in capital and intermediate goods production.

Despite the uptick in growth, manufacturing employment was broadly unchanged in May. Over 99 per cent of panellists reported unchanged staffing levels, citing uncertainty about the sustainability of growth.

"PMI data signal led a further robust expansion of the Indian manufacturing economy in May. Both output and new order growth accelerated to four-month highs, whereas the rise in export orders lost traction. The outlook for the sector is, however, clouded by a stagnant jobs market as firms remain uncertain about the sustainability of the upturn," a release from Markit for HSBC PMI has stated.

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