Service sector declined in October, PMI reached lowest level in 8 months

Manufacturing activity in India slowed in October as new orders grew at the slowest pace in a year, a monthly survey said, slowing growth in output and employment. The S&P Global India Manufacturing Purchasing Managers' Index (PMI) fell to 55.5 in October from 57.5 in September, the slowest rate of expansion since February.

October PMI data pointed to improving operating conditions for the 28th consecutive month. In PMI language, a print above 50 means expansion, while a score below 50 indicates contraction.

"The survey's new orders index slipped to a one-year low as some companies raised concerns about the current demand picture for their products," said Pollyanna de Lima, economics associate director at S&P Global Market Intelligence. There were substantial, if slow, increases in new orders, production, exports, purchasing levels, and purchasing stocks. Hiring activity faded and business confidence fell to a five-month low. We saw broadly stable inflationary forces in the manufacturing industry. "It appears that the modest increase in input costs has been directly passed on to customers."

He adds that business sentiment remained firmly in positive territory, but fell to a five-month low amid concerns about the path of inflation and demand.

Let us tell you that according to the survey, the figures for October have indicated a decline in growth since September. Anecdotal evidence suggests that slow demand for some products and stiff competition have put a halt to the uptrend.

On the jobs front, less than 4 percent of companies hired additional employees and 95 percent left the workforce numbers unchanged. In such a situation, the rate of employment creation was modest and the slowest since April. In addition, output price inflation declined.

The S&P Global India Manufacturing PMI is compiled from responses to questionnaires sent by S&P Global to purchasing managers in a panel of approximately 400 manufacturers.