According to the HSBC Flash PMI report, India’s private sector growth slowed down in July to the lowest level since March 2022. This decline is mainly due to slowdown in the service sector and weak domestic demand.
New Delhi [भारत]July 24 (ANI): India’s private sector growth slowed further in July. This is the weakest pace of expansion after March 2022. According to the HSBC Flash PMI data report, challenging market conditions, competitive pressures and weak demand have impacted business activities.
The HSBC Flash India PMI Composite Output Index fell to 54.3 in July from 57.1 in June, indicating the slowest pace of expansion in private sector activity since March 2022, the report said. The HSBC Flash India PMI Composite Output Index is a seasonally adjusted index that measures month-on-month changes in the combined output of India’s manufacturing and services sectors.
“HSBC Flash PMI® data for July showed the weakest expansion in private sector sales and output since the start of 2022,” it said.
However, the report also noted that new export orders continued to grow at a strong pace, companies continued to hire additional workers, and both input costs and output charges rose sharply.
The report said growth was impacted by increasingly challenging market conditions, competitive pressures, order cancellations, reduced customer enquiries, and shortage of key raw materials.
Although new orders continued to rise at the start of the second fiscal quarter, the pace of expansion slowed to its weakest level in nearly four and a half years and remains moderate by historical standards.
Slowdown in service sector, improvement in manufacturing
The slowdown in growth in both output and new orders was mainly driven by the services sector, where the pace of expansion slowed significantly from June to the weakest in 53 months. In contrast, the manufacturing sector regained some of the momentum lost in previous months.
Both manufacturing and services firms recorded strong export growth during July, with goods producers outperforming service providers, the report said. The seasonally adjusted index for manufacturing exports rose nearly four points, while at the composite level, international sales expanded at the fastest pace since March.
Improvement in manufacturing figures
Special data related to manufacturing also showed improvement in many sectors. Companies increased their purchasing activities, while further improvement in vendor performance helped lead to a sharp increase in input inventories. After declining in June, finished goods stocks also increased during July.
Despite these improvements, the HSBC Flash India Manufacturing PMI fell slightly to 53.9 in July from 54.2 (June), indicating a below-trend improvement in overall factory conditions.
Overall, the report highlighted that while India’s manufacturing sector showed signs of resilience and export demand strengthened, slow growth in the services sector and weak domestic demand led to the weakest expansion in the country’s private sector activity. (ANI)
(Except for the headline, this story has not been edited by Asianetnews Editorial staff and is published from a syndicated feed.)