New Delhi: HSBC Flash India Composite Output Index jumped to 59.5 in November from 59.1 in October marking the sharpest rise in 3 months on the back of a jump in services output and better than expected performance by the manufacturing sector. For the third straight month, manufacturing sector orders grew at a faster clip than the services sector. However, the latter registered greater job growth and at the fastest clip since December 2005.
According to HSBC India Chief Economist Pranjul Bhandari, despite the pick in services sector activity and manufacturing sector outperformance, these sectors are witnessing price pressures in terms of the costs of food and wage as well as raw materials, respectively.
While the HSBC Flash India Manufacturing PMI moderated to 57.3 in November from 57.5 in October, the order book kept ticking led by export-driven sales. Factory international sales were more robust compared to the services sector. Asia, Europe and the Americas registered a rise in orders, according to the report. Hiring efforts rose owing to a widening backlog as companies sought to ramp up capacity owing to a rise in business. Business volumes outstanding in November were at their highest since May.
Rising costs at 15 month highs
Manufacturing sector and services sector costs of procuring raw materials as well as food and wages rose, witnessing the highest upward pressure since August 2023, according to the report by HSBC. Key commodities whose prices rose in November included aluminium, cotton, leather and rubber.
The month witnessed the sharpest inflation spike in a little under 12 years. However, the rise in demand enabled companies to pass on the cost to customers, according to the report. Both the services and manufacturing sectors witnessed a similar rise in charge inflation in November compared to October.
The HSBC Future Output Index registered a six-point jump over the long-term average and rose to a 6-month high as marketing efforts coupled with a rise in enquiries from new clients registered an upturn, boding well for the future, said survey participants, according to the report.
HSBC India composite PMI rose to 59.5 in November from 59.1 in October as factory sector activity rebounded at a faster clip than the services sector. Know how inflation affected growth in these sectors. Economy Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
