India’s economic activity accelerated in September, regaining momentum after slowing in recent months as manufacturing climbed to seven-month high and services picked up pace, a flash survey by HSBC Holdings Plc showed Wednesday.
The services purchasing managers’ index rose to 55.8 from 54.1 in August, while the manufacturing purchasing managers’ climbed rose to 55.7 from 52.8 last month. That left the composite index at 56.5, compared with 54.3 in August.
The indexes, which provide an early gauge of private-sector activity, are based on preliminary survey responses and may be revised when final PMI figures are released next month. A reading above 50 indicates expansion, while one below that level signals contraction.
“Output growth ticked higher at both manufacturing and services companies, with goods producers leading the latest upturn. Aggregate new orders also rose at a quicker pace, prompting a solid expansion in jobs,” HSBC said in a statement. With the expansion in place, the composite index “was back above its long-run average,” it said.
Bond yields and rupee, however, stayed unchanged after the reading.
India’s economy proved more resilient than expected to a war-led energy shock, expanding 7.8% last quarter as household consumption and business investment powered growth. India, the world’s third-largest oil importer, remains vulnerable to elevated energy costs and supply disruptions that can weigh on domestic activity.
“Renewed tensions in the Middle East have once again led firms to build buffers to manage the uncertainties,” said Pranjul Bhandari, chief India economist at HSBC.
Brent crude is hovering around $100 a barrel. However, the government hasn’t raised pump prices since May, insulating the economy from volatile energy prices for now.
Still, price pressures are building. Figures last week showed India’s inflation accelerated in August, moving closer to the top of the central bank’s 2%-6% target range and potentially narrowing the scope for policymakers to remain on hold for long.
Most economists expect the Reserve Bank to raise interest rates on Oct. 7. The central bank has stayed on hold so far this year.
Disclaimer: This report is auto generated from the Bloomberg news service. ThePrint holds no responsibility for its content.
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