Manufacturing Activity Surges Amid Strong Demand
India’s manufacturing activity witnessed a significant uptick in June 2024, driven by strong demand, after experiencing a slowdown in May 2024 due to an intense heat wave, according to a survey by S&P Global. The seasonally adjusted HSBC Manufacturing Purchasing Managers’ Index rose to 58.3 in June from 57.5 in May, indicating expansion. The consumer goods sector particularly benefited, with underlying demand remaining favorable and new business inflows increasing.
In response to the rising number of orders, manufacturers increased their workforce numbers, achieving the strongest rate of job creation in the survey’s history. On the pricing front, overall input costs continued to rise in June due to higher staff expenses and increased material and transportation costs. Despite this, the rate of inflation eased compared to May. To manage additional cost burdens, firms raised their selling prices.
Looking ahead, manufacturers are optimistic about output growth over the next year, anticipating further improvements in demand and order volumes. This positive outlook, however, saw a slight dip in overall confidence, marking a three-month low.