Private sector business activity rises to 13-month high in May: PMI data

According to a private survey, India's private sector output grew at its fastest pace in 13 months in May, driven by a sharp rise in services that prompted the sector to employ more people. HSBC's flash India Composite Purchasing Managers' Index (PMI), compiled by S&P Global, rose to 61.2, up from a downward revised figure of 59.7 in April. The index, which measures monthly change in the combined output of manufacturing and services, has been above the 50 mark, which separates growth from contraction for the 46th consecutive month. The increase was the most pronounced since April 2024, with service providers reporting the fastest rise in output in 14 months. Monitored companies attributed the growth to buoyant demand, technological investment, and expanded capacities.

Pranjul Bhandari, chief India economist at HSBC, said the flash PMI for May indicates another month of strong economic performance as growth in production and new orders among manufacturing firms remains robust despite a marginal cooling from the rates of increase observed in April. Notably, there is a firm pick-up in employment, especially in the service sector, suggesting that healthy job creation accompanies the expansion of India's manufacturing and services sectors. The final manufacturing PMI figure for May will be released on June 2, while services and composite PMI figures will be released on June 4.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.