FX.co ★ India Manufacturing Growth Remains Strong On Robust Demand

S&P Global's survey results revealed robust growth in India's manufacturing activity, registering the second-highest rate in over three years, driven by powerful demand conditions.

In April, the HSBC Manufacturing Purchasing Managers' Index, which is adjusted seasonally, slightly fell to 58.8 from March's 59.1. Regardless, any score above 50.0 signifies an expansion phase.

April witnessed strong demand for Indian manufacturers' goods from both local and international buyers. Nevertheless, growth was primarily fuelled by the domestic market.

A significant increase in total new orders was largely attributable to healthy demand patterns and effective marketing strategies.

The output rose at the second-highest rate in three and a half years due to consistent enhancements in demand, favourable economic conditions, and a surge in sales volumes.

Anticipating that the conducive demand conditions would continue, manufacturers considerably increased their stocks of purchases in April, further supporting their inventory-building efforts.

Regarding costs, inflation of input price escalated due to the rising prices of materials such as aluminium, paper, plastic, and steel. Consequently, this led to a swift hike in the selling price inflation, reaching a three-month peak.

With expectations that the demand will stay robust, Indian manufacturers held a positive outlook for their production in the upcoming year. This optimism resulted in hiring more employees, with the job creation rate achieving its fastest pace since September 2023.