India’s manufacturing PMI increased from 55.3 in February to 56.4 in March, the strongest growth in three months, according to S&P Global India Manufacturing Purchasing Managers’ Index. The report said that March PMI signalled the strongest improvement in operating conditions in 2023 so far. However, the PMI average for the final fiscal quarter at 55.7 was lower than that recorded in the previous period of 56.3 in Q3.
Pressure on supply chains subsided, availability of raw material improved, and input cost inflation retreated to its second-lowest mark in two and a half years. Goods producers concentrated on rebuilding their stocks.
Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence, said, “Underlying demand for Indian goods remained strong in March, underscored by the quickest upturn in factory orders for three months. Hence, production continued to expand at a robust clip and firms stepped up their stockbuilding efforts. Companies reported abundant capacity among themselves and their suppliers. Pending workloads expanded only marginally in March, hindering job creation. As for supply chains, improved availability of raw materials among vendors resulted in shorter delivery times and retreating price pressures. Overall, input costs rose at the second-slowest rate since September 2020.”
De Lima said that firms tried to benefit as much as possible from this moderation in inflation by acquiring additional raw materials and semi-finished items.
New export orders increased in March, with the rate of expansion quicker than February but historically subdued. Output rose at the quickest pace since last December and outpaced its long-run average.
“Goods producers kept payroll numbers broadly unchanged in March. This followed a one-year sequence of monthly increases in employment,” the report added.