Manufacturing in India slowed down in June, according to the Nikkei India Manufacturing Purchasing Managers’ Index released by London-based global information provider IHS Markit on Monday. The monthly index was at 52.1, down from May’s three-month high of 52.7.
However, a reading above 50 shows an expansion, while a lower reading indicates a contraction in manufacturing activity. This is the 23rd consecutive month that the manufacturing purchasing managers’ index has remained above the 50-point mark, according to PTI.
The moderated growth has been attributed to softer increase in new work intakes, which in turn led to slower rises in output and employment. “Gauges of factory orders, production, employment and exports remained inside growth territory, but rates of expansion softened in all cases as domestic and international demand showed some signs of fading,” said Pollyanna de Lima, principal economist at IHS Markit.
While consumer goods sector – where there was increase in sales, output and employment – was the key source of growth, production in intermediate good category expanded modestly. However, jobs stagnated.
Data showed only a moderate increase in input costs and this enabled firms to lower charges. “Firms tried to boost sales by offering price discounts for their goods, in light of subdued rises in cost burdens,” said Lima. “Tamed cost inflation may assist competitive pricing and lift demand to a meaningful extent as we head into the second half of 2019.”