New Delhi, Dec 1 (KNN) India's S&P Manufacturing PMI in November stood at 56, up from the eight-month low of 55.5 seen in October.

After slowing in October, growth of output gathered pace as strengthening client demand and more favourable input supply boosted production volumes. 

That marked nearly two and a half years of the index being above the 50-mark separating expansion from contraction.

Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence, said, "India’s manufacturing industry maintained its robust performance in November, with output regaining growth momentum. Firms’ ability to secure new business, both domestically and from abroad, remained central to the success of the sector."

As per the report, a key feature of the latest results was a substantial easing of price pressures. Although average purchasing costs rose again, the rate of inflation eased to the lowest in the current 40-month sequence of increases and was negligible by historical standards. 

“Sustained new order growth continued to be good news for the sector’s labour market, with recruitment remaining on an upward path. Expanded capacities, rising workloads and the need to replenish stocks of finished goods collectively indicated that India's manufacturing economy is clearly in good shape as 2023 draws to a close, with expectations for a continued strong performance in 2024,” Lima added.

Business confidence for the coming 12 months remained strong, with the future output sub-index at 62.2. However, that was a seven-month low due to rising inflation expectations, the note said.

While domestic demand appeared strong, international demand took a hit, with new export orders at a five-month low.

Even though input costs grew at the slowest pace since July 2020, not all the benefits were passed on to customers as the rate of output price inflation only eased to a seven-month low.

"Prices for raw materials and components still rose in November, but improved availability at suppliers amid subdued global demand for inputs led to a considerable retreat in cost pressures," added De lima.

"Some concerns over prices increasing in the near-term were reflected in the data for business sentiment."

Retail inflation in India eased to a four-month low in October, but remained above the Reserve Bank of India's 4 per cent medium term target.

(KNN Bureau)