Private Sector Economy Rises Sharply in Aug on Robust Rise in New Orders, Shows Flash PMI Data

Summary

India’s private sector growth hits record, HSBC Flash Composite PMI at 65.2.
Services PMI reaches survey-high 65.6; Manufacturing PMI climbs to 59.8.
Export orders expand fastest since 2014, driven by Asia, US, Europe.
Inflationary pressures rise as firms raise output charges on strong demand.

India’s private sector economy witnessed its fastest growth since the start of survey data in 2005 with the HSBC Flash India Composite PMI Output Index rising from over four points from 61.1 to 65.2 in July, S&P Global said on Thursday.

An accelerated growth was reported in manufacturing and services sector, this month with services marking a fresh survey high in business activity. The services sector led this growth with HSBC Flash India Services PMI Business Activity Index soaring to a survey high of 65.6 from 60.5 in the last month.

According to the HSBC Flash India Manufacturing PMI, the reading rose to 59.8 in August from 59.1 in July, its highest reading since January 2008. This indicates faster improvement in factory operating conditions.

Survey respondents have given strong advertising campaigns, new client onboarding and solid demand as the primary drivers of growth. - null

India’s Services Sector PMI Reaches 11-month High in July Driven by Strong Export Demand

By Outlook Business Desk

As per the index, demand conditions have further strengthened with both goods producers and service providers recording sharp increases in new business. Additionally, export orders grew at the fastest pace since composite data collection began in 2014, supported by stronger inflows from Asia, the Middle East, Europe and the US.

A continued growth was noticed in hiring activity for the 27^th straight month. The overall job creation also increased in August, driven by stronger employment growth in services, which offset a marginal slowdown in manufacturing. In addition to that, backlogs of work rose slightly, the slowest increase since May as firms expanded workforce capacity.

Manufacturing PMI Activity In July Grew at Fastest Pace - null

Manufacturing Activity Reaches 16-month High in July Backed by Strong Demand, Reveals PMI Data

By Outlook Business Desk

There has been marked rise in inflationary pressures with input costs rising due to higher wage bills, particularly in services, and elevated raw material prices. Additionally, output charges were raised at the sharpest pace in 12-and-a-half years, as firms reported that buoyant demand allowed them to pass on higher costs.

Private sectors have also reported their most optimistic outlook since March. Both manufacturers and service providers said that robust demand expectations have been the key driver of positive sentiment for the year ahead.

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Private Sector Economy Grows Sharply in Aug on Robust Rise in New Orders, Shows Flash PMI Data

As per the index, demand conditions have further strengthened with both goods producers and service providers recording sharp increases in new business.