India's Manufacturing Sector Witnesses Eight-Month Low Growth in September

India's manufacturing sector growth dipped to an eight-month low in September, according to a monthly survey. The HSBC India Manufacturing PMI fell from 57.5 in August to 56.5 in September, indicating slower growth in output, sales, and export orders. Input costs increased, but factory gate price inflation eased, affecting profit margins and hiring growth.

India's manufacturing sector experienced its slowest growth in eight months during September, as reported by a monthly survey on Tuesday.

The seasonally adjusted HSBC India Manufacturing PMI, a key indicator of manufacturing activity, declined to 56.5 in September from 57.5 in August, marking the weakest growth since January. A PMI score above 50 signifies expansion, while below 50 indicates contraction.

Despite growth in output and new orders, the sector faced a decelerating pace, with export demand reaching its lowest level since March 2023. Additionally, rising input costs and moderate increases in selling prices squeezed profit margins. This squeeze had a trickle-down effect on employment growth, which slowed for the third consecutive month. Business confidence also fell to its lowest since April 2023, with only 23% of manufacturers expecting output growth in the coming year.

(With inputs from agencies.)