HSBC Flash PMI Captures Strong Growth Momentum In Manufacturing & Services; Composite Output 13-Month High At 61.2

New Delhi, May 22 (KNN) India's private sector demonstrated strong momentum in May, with services activity leading a broad-based expansion supported by robust domestic and international demand, according to the HSBC Flash India PMI survey released Thursday.

The survey, compiled by S&P Global, also indicated renewed business confidence for the first time since January.

The HSBC Flash India Composite Output Index, which measures activity across manufacturing and services sectors, climbed to 61.2 in May from 59.7 in April, representing the most pronounced increase since April 2024.

The index has maintained readings above the 50-point threshold that separates expansion from contraction for more than three years, signalling sustained economic growth.

Manufacturing activity showed slight deceleration while services posted its strongest performance in 14 months.

The HSBC Flash India Manufacturing PMI registered a marginal increase to 58.3 in May from 58.2 in April, maintaining steady growth momentum.

Meanwhile, the Services PMI Business Activity Index surged to 61.2 from 58.7, marking the fastest expansion since March 2024.

The Manufacturing Output Index declined slightly to 61.4 from April's 61.9, with goods producers reporting the slowest output increase in three months.

Service providers, however, recorded their fastest growth rate in over a year. Survey participants attributed the overall expansion to strong demand conditions, technology investments, and capacity enhancement initiatives.

The flash PMI survey draws responses from approximately 400 manufacturers and 400 service providers, providing an early indicator ahead of final data scheduled for release next month.

This preliminary assessment captures emerging economic trends before comprehensive monthly statistics become available.

India's economic growth trajectory aligns with the government's objective to achieve a USD 10 trillion economy within the next decade.

This expansion is being driven by manufacturing development in strategic sectors including semiconductors, electronics, electric vehicles, renewable energy, and defence systems.

Government initiatives have increased capital investment in infrastructure development, employment generation, and industrial advancement to support these goals.

Pranjul Bhandari, Chief India Economist, HSBC, noted that the flash PMI reflects continued strong economic performance. Manufacturing firms maintained robust production and new order growth, despite moderate cooling from April levels.

Employment conditions showed particular improvement, especially within the services sector, indicating healthy job creation accompanying the expansion of both manufacturing and services industries.

(KNN Bureau)