India’s manufacturing PMI rose to 55.3 in October, employment at 33-mth high | So Good News
India’s factories grew stronger in October as demand and output remained firm, prompting employers to hire workers at the fastest rate in nearly three years, according to a private survey released on Tuesday.
Unlike other economies, India has seen higher inflation since the start of the year and has shown better resilience against a depreciating currency against the US dollar.
A manufacturing managers’ index compiled by S&P Global rose to 55.3 in October from 55.1 in September, beating the average estimate of 54.9 in a Reuters poll and remaining above the 50 level that separates growth from contraction for the sixteenth month.
Pollyanna De Lima, associate director of economics at S&P Global Markets, said: “Indian manufacturing showed signs of resilience again in October, with factory orders and output rising strongly, although growth slowed.
“Manufacturers have continued to ease purse strings as they expect demand to remain buoyant. Firms have ramped up import purchases to better align with customer purchases.” Overall demand and output expanded at a slower pace last month, but growth remained solid, with foreign demand growing at the strongest rate since May.
This led companies to increase headcount at the fastest rate since January 2020. Optimism about future output is above long-term averages.
While import price inflation remained around last month’s level. Overall inflation, which rose to a five-month high in September, is likely to moderate as prices charged rose at their slowest rate since February.
This could provide some breathing room for the Reserve Bank of India, which is widely expected to adopt a slower interest rate approach than its major peers in the coming months.
A widening policy gap between the big US Federal Reserve and the dovish RBI could weigh on the rupee, which has lost more than 10% against the greenback this year, suggesting the central bank may continue to burn through its dollar reserves. Money.
(Reporting by Indradip Ghosh; Editing by Kim Coghill)
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