India's Private Sector Output Surge
India’s private sector output reached a six-month high in February, largely attributed to the services sector, as revealed by a private survey conducted by HSBC.
HSBC Flash India Composite PMI Output Index
- The index increased to 60.6 in February from 57.7 in January.
- This index is a weighted average of manufacturing and services indices.
Sector Performance
- Services Sector
- The HSBC Flash India Services PMI Business Activity Index rose to 61.1 in February from 56.5 in January.
- This marks the strongest expansion in nearly a year.
- Manufacturing Sector
- The Manufacturing PMI slightly declined to 57.1 in February from 57.7 in January.
- Despite the decline, it remained above its long-run average of 54.1.
Market Dynamics
- New Orders
- Service providers recorded the highest increase in new business since August 2024.
- The increase in new export orders was the fastest in seven months.
- Growth Momentum
- Despite a mild loss of growth momentum, goods producers led in new export orders.
Business Outlook
- A healthy acceleration in orders and output is maintaining firm optimism about the future.
- Favourable demand conditions led to an increase in outstanding business volumes, prompting workforce expansion.
Employment Trends
- Firms hired both permanent and temporary workers, with some also bringing in trainees.
- Hiring was more robust in the services sector compared to manufacturing.
Cost Pressures
- Overall business costs increased, with inflation at a four-month low.
- Services firms faced more pronounced cost pressures compared to manufacturers.
