Manufacturing PMI in December rose to 57.8, highest in 2 years

New Delhi, Jan 2 (KNN) India’s manufacturing PMI, compiled by S&P Global, rose to 57.8 in December from November's 55.7, making it the highest since October 2020.

The PMI average for the third fiscal quarter (56.3) was the highest recorded since one year ago, it said.

The survey also showed that Manufacturers scaled up production and the upturn in output was sharp and the best seen since November 2021.

Additional materials were purchased and extra workers hired as companies sought to supplement production and maintain healthy levels of inventories," said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence.

"While some may question the resilience of the Indian manufacturing industry in 2023 amid a deteriorating outlook for the global economy, manufacturers were strongly confident in their ability to lift production from present levels," the S&P economist said.

According to the survey, demand resilience boosted sales growth in December, with the rate of increase picking up to the quickest since February 2021.

International demand for Indian goods also improved, but did so to a lesser extent than in November, the survey said. Overall, new orders from abroad rose at the slowest pace in five months as several companies reportedly struggled to secure new work from key export markets.

Cost pressures, according to the survey, remained relatively muted in December, with the overall rate of inflation little-changed from November and the second-slowest since September 2020.

“Underlying data indicated that price reductions for some raw materials partly offset increases elsewhere. Moreover, for the first time in close to two-and-a-half years, the rate of inflation for selling prices outpaced that seen for input costs,” the survey said.

According to the survey, companies were optimistic in their year-ahead outlook for production.  Demand buoyancy were cited among the key opportunities to growth prospects.  (KNN Bureau)