India composite PMI rises to 54.6 in Aug from 52 month low: HSBC

India’s private sector activity showed a modest recovery in August, with the HSBC Flash India Composite PMI Output Index climbing to 54.6 from 54.3 in July, according to the latest HSBC Flash India PMI report.The July reading was the lowest in 52 months. Although August marked a marginal improvement, it remained the second-weakest reading since March 2022, indicating subdued private sector growth.The composite index tracks changes in the combined output of India’s manufacturing and services sectors. Companies reported a slightly stronger increase in new orders in August, but growth remained below the trend of recent years amid challenging market conditions, competitive pressures and subdued customer demand.
The improvement was largely driven by the services sector. The HSBC Flash India Services PMI Business Activity Index rose to 54.5 in August from 53.3 in July, with both business activity and new work growth strengthening.Manufacturing, however, continued to lose momentum. The HSBC Flash India Manufacturing PMI fell to 52.9 from 53.5 in July, marking its third consecutive monthly decline,according to sources.Manufacturing output growth also weakened, with the output index falling to 54.9 in August from 56.4 in July. The sector recorded its weakest increases in production and new orders in five years.
Manufacturing companies increased purchasing activity in August, broadly in line with higher new order volumes. However, the pace of input purchases slowed to its weakest level in more than five years, contributing to softer inventory accumulation.The August data showed a divergence between India’s two major private-sector segments, with services activity recovering moderately after a weak July while manufacturing growth continued to slow.