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India manufacturing PMI slips to five-year low in August
The HSBC India Manufacturing PMI fell to 52.8, with output and new orders growth both reaching five-year lows, while a separate index for future output confidence rose but stayed subdued.
India’s manufacturing momentum weakened further in August, with the HSBC India Manufacturing Purchasing Managers’ Index (PMI) falling for a third straight month to 52.8, down from 53.5 in July, according to LiveMint Markets.
The survey showed the weakest improvement in the sector’s health in five years, also below the long-run average of 54.2, as output and new orders growth slowed to five-year lows. Firms cited challenging market conditions and weak demand for some products, while input cost pressures eased with input inflation at its weakest pace in six months.
Even with receding input inflation, manufacturers continued to face higher material costs, including steel, and transport costs, and they had limited ability to raise selling prices. Output charge inflation was slight, the slowest in 45 months and below its long-run trend.
Looking ahead, about 16% of survey participants forecast higher output over the next 12 months, with the rest expecting no change, while the PMI’s Future Output Index rose to its highest level since May but remained subdued versus historical standards. LiveMint Markets also cautioned against extrapolating India’s Q1FY27 GDP strength, noting real GDP grew 7.8% year-on-year, driven by fixed investment, private consumption, and manufacturing, and highlighting potential risks to second-half growth from issues including possible government capex cuts.