PMI Rises From 57.5 in May to 58.3 in June: HSBC Report The HSBC India Manufacturing Purchasing Managers' Index (PMI) for June 2024 indicates a recovery in the Indian manufacturing sector, with the PMI rising from 57.5 in May to 58.3 in June.
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Manufacturing output surged significantly, spurred by robust demand and new business opportunities. The consumer goods sector propelled, showing strong performance, while the intermediate and investment goods categories also saw substantial increases. Sales at manufacturers in India expanded, fueled by solid underlying demand, higher export volumes, and successful advertising campaigns.
The HSBC India Manufacturing Purchasing Managers' Index (PMI) report for June 2024 signals a rebound in the Indian manufacturing sector. The PMI recorded an increase from 57.5 in May to 58.3 in June, suggesting that evidence of business conditions continues to show an uptick in strength. This pick-up is driven by accelerated growth in production and new orders. The rate of job creation in the manufacturing sector registered at a series record high for this period of growth in employment, since data collection began in March 2005. While input costs have come down slightly from May's level, they are still high, but manufacturers have been able to pass on increased costs to customers in response to strong demand.
June witnessed a significant surge in new export orders, driven by robust demand from key markets including Asia, Australia, Brazil, Canada, Europe, and the US. Although the growth pace slowed slightly from May's levels, the latest expansion remains remarkably strong, exceeding its historical average.
Maitreyi Das, Global Economist at HSBC said, "The Indian manufacturing sector ended the June quarter on a stronger footing. The headline manufacturing PMI rose by 0.8 percentage points to 58.3 in June, supported by increased new orders and output. Consequently, firms increased their hiring at the fastest pace in over 19 years. Input buying activity also rose during the month. On the price front, input costs moderated slightly in June, but remained at elevated levels. Manufacturers were able to pass on higher costs to customers, as demand remained robust, resulting in improved margin."
Maitreyi continued that the overall outlook for the manufacturing sector remains positive, with nearly 29 per cent of panellists' expectations of continued improvements in demand, order book volumes, and client inquiries over the next year. However, despite this optimistic outlook, overall confidence receded to a three-month low.
