Flash PMI data from HSBC paints an encouraging picture for India’s private sector in January, with manufacturing and services activity expanding at a quicker clip. The Composite PMI index advanced to 59.5 from 57.8 last month, per S&P Global’s compilation released Friday.
Favorable conditions prevailed despite accelerating inflation, as cost and price pressures stayed at moderate levels. This balance suggests the economy is gaining steam without overheating.
Pranjul Bhandari, HSBC Chief India Economist, highlighted the dual-sector surge: ‘Growth momentum picked up in manufacturing and services alike.’ While manufacturing improved, it lagged the year’s early average.
A sharp rebound in new orders post-year-end dip propelled activity, with input costs rising faster for producers than providers. Respondents pointed to surging demand and proactive sales strategies for the upswing, where manufacturing growth outstripped services.
Export momentum was particularly impressive, marking the best in four months with demand from diverse regions including Asia, Europe, and the Middle East. January also saw hiring pick up after December’s standstill, signaling job market recovery.
Companies’ 12-month business outlook brimmed with positivity, driven by these operational gains. As global economies grapple with challenges, India’s PMI surge highlights its manufacturing prowess and service sector dynamism, setting a strong tone for 2025.