In May, the S&P Global India Manufacturing Purchasing Managers Index (PMI) was adjusted for the season at 54.6, down from 54.7 in April, indicating that the industry is continuing to improve. India’s manufacturing sector growth slowed in May after international orders surged despite rising prices.
In May, the S&P Global India Manufacturing Purchasing Managers Index (PMI) registered 54.6, down from 54.7 in April. In April, new orders and production both increased substantially.
For the 11th month in a row, the PMI statistics showed an improvement in overall operational circumstances.
The latest figures show that sustainability continues across the industry. The above 50.0 study was eleven in a few months and was accompanied by a strong improvement in working conditions.
Despite the rise in retail prices, the market remained resilient in May, suggesting steady progress. Similar to April, businesses have taken a significant increase in all-new orders. The growth of new export orders increased significantly in May, according to the data. Since April 2011, the growth rate has been sharp and incredibly rapid.
Indian producers saw further increases in commodity prices in the first quarter of the 2022-23 fiscal year.
Companies found new business despite sales prices rising sharply over an eight-and-a-half-year period as the burden of additional costs continued to be placed on customers.
S&P Global Market Intelligence Economics Associate Director Pollyanna De Lima said, “With the sharp growth of exports for 11 years, new orders have been continuously expanded. In response to the need for flexibility, companies have continued their efforts to restructure inventories and hire more staff accordingly.”
In PMI language, the indices vary between 0 and 100, with a reading above 50 indicating an overall increase compared to the previous month, and below 50 an overall decrease. The indices are then seasonally adjusted.
“In May, India’s manufacturing industry grew at a rapid pace. New orders were broadened further, in part due to the strong expansion in overseas sales over the last eleven years,” said S&P Global Market Intelligence’s Director of Economic Affairs.
Producers boosted productivity in May, despite sustained consumption improvement and weak COVID-19 limitations, anticipating further growth in aggregate output.
“Business confidence dropped dramatically in May amid inflation fears, the lowest level in little over two years.” Approximately 9% of panelists expect performance to improve over the next 12 months, while 88 percent expect no change at current levels,” he noted.
The survey emerges a day after India’s fourth-quarter economic growth slowed drastically, owing to Omicron-led restrictions in January, worldwide supply constraints, and higher commodity costs. The January-March quarter’s Gross Domestic Product (GDP) was 4.1 percent, one of the worst years despite mounting competitive pressures.
May PMI Manufacturing
Even though supply deflation decreased marginally in May, prices have been consistently increasing since October 2013, implying that annual volatility will continue high in the next months, potentially rising living costs.
“Inflation remained stable in May, but it soared to its highest level in eight and a half years as businesses continued to pass on higher expenses to their customers, “ said S&P Global Market Intelligence Economics Associate Director Pollyanna De Lima.
Installation costs continued to rise for 22 consecutive months in May, with companies reporting higher prices for electronic components, energy, goods, food, metals, and textiles.
Manufacturers increased their sales in May and extended the current expansion lineup to 11 months. Sales growth and increased production demand were the main reasons for the increase.
Jobs in the manufacturing sector increased during the month as sales increased, and the employment growth rate has increased significantly since January 2020.
As a result of inflation, business sentiment has been lowered by the second level of confidence in just over two years.
S&P Global said that about 9 percent of panels predict results growth over the next 12 months, with 88 percent predicting that there will be no change to current levels.
