India’s manufacturing sector expanded at the weakest pace in twenty two months in October, as output and new orders rose at slower rates, survey data from Markit Economics showed Monday.
The Nikkei Manufacturing Purchasing Managers’ Index fell 50.7 in October from 51.2 in the previous month. However, any reading above 50 indicates expansion in the sector.
Output growth eased in October on the back of a slower rise in new orders.
Rates of expansion in both production and order books were the weakest in their current 24-month sequences of growth. This was due to challenging economic conditions and a reluctance among clients to commit to new projects.
At the same time, foreign orders rose for the twenty-fifth successive month in October, though growth was little changed from the marginal pace seen in September.
Manufacturing employment increased for the first time since January, but only marginally.
On the price front, input price inflation rose in October, led by higher purchase costs. However, the rate of increase was only slight in the context of historical data.
“A return to inflationary pressures, meanwhile, indicates that the RBI may pause its loosening cycle for the rest of the year following a 50 bps cut to the key repo rate in September. Upcoming survey data will show how effective the central bank’s effort to revive the economy has been,” Pollyanna De Lima, Economist at Markit and author of the report, said.
The material has been provided by InstaForex Company – www.instaforex.com