Manufacturing sector growth falls to 4-month low in Feb.: PMI

Manufacturing sector growth falls to 4-month low in Feb.: PMI

Context:

• India’s manufacturing sector activity fell to a four-month low in February, as factory output and new business orders rose at a slower pace, according to a monthly survey.

Nikkei India Manufacturing Purchasing Managers Index (PMI):

• The Nikkei India Manufacturing Purchasing Managers Index (PMI) fell to 52.1 in February from 52.4 in January, indicating a modest improvement in operating conditions.
•  This is for the seventh consecutive month that the index remained above the 50-point-mark that separates expansion from contraction.
• According to Japanese financial services major Nomura, India’s manufacturing PMI remained in the expansion zone, but suggested some consolidation after the rapid ramp up of activity in December.
• In December 2017, the index had touched a 60-month high of 54.7.

Highlights of the survey:

• On the prices front, the survey said that cost inflation accelerated to the sharpest since February 2017, adding to expectations that inflationary risks will continue over the coming months.
• The survey further noted that Indian manufacturers remained optimistic towards the 12-month outlook for output during February.