India's manufacturing sector maintained robust growth in August, though the rate of expansion moderated slightly due to more subdued increases in new orders and output, as indicated by survey results from S&P Global on Monday.
The seasonally adjusted HSBC Manufacturing Purchasing Managers' Index (PMI) fell to 57.5 in August from 58.1 in July. However, a PMI reading above 50.0 still signifies expansion.
New orders increased at their slowest rate in seven months in August amidst competitive market conditions. The overall growth was largely driven by enhanced advertising, increased brand recognition, and strong demand trends. Meanwhile, the growth rate of new export orders also decelerated.
During August, firms voiced concerns over intense competition and changing consumer preferences, which adversely affected unit output. The expansion in output slowed to its weakest pace since January. Job creation similarly decelerated, yet the overall rate of employment growth remained solid.
On the pricing front, cost pressures eased in August, with the rate of input price increases being the slowest in five months. This allowed firms to ramp up their purchasing activities for additional raw materials and semi-finished goods. Nonetheless, there was an acceleration in selling price inflation.
