India's manufacturing sector growth rate at 14-month low in February, PMI data released

The expansion in India's manufacturing industry slowed to a 14-month low in February because of weak growth in new orders and production. This is according to the PMI monthly survey report on Monday. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) for February was 56.3, down from 57.7 in January. However, the PMI reading remained in the 'expansionary' zone. A PMI reading above 50 indicates expansion, and a reading below 50 indicates contraction.

"While output growth slowed to its weakest level since December 2023, the overall momentum in India's manufacturing sector remained broadly positive in February," said Pranjul Bhandari, chief India economist at HSBC. The pace of expansion remained robust, although slower than January's 14-year high, the survey said. New export orders grew strongly in February, the survey said, as manufacturers continued to benefit from strong global demand for their goods.

In addition, favorable domestic and international demand prompted companies to increase purchasing activity and hire additional workers. "Business expectations also remained very strong, with nearly a third of survey participants expecting more production in the coming year," Bhandari said.