Manufacturing activity rose to a five-month high in February

Mumbai: The country's manufacturing sector activity was at a five-month high in February ended. The HSBC Purchasing Managers' Index (PMI) for the country's manufacturing sector stood at a five-month high of 56.90 as a result of the increase in orders. The highest number has been seen since September last year. The PMI of January of the current year was 56.50.

According to the report prepared by S&P Global, there has been a decrease in inflationary pressure and an increase in the activity of the manufacturing sector due to demand from abroad. The PMI has remained above 50 for the 32nd consecutive month in February. An index above 50 is called an expansion of that sector.

In the December quarter of the current financial year, the country's economic growth rate has come to 8.40 percent, much higher than expected. The GDP numbers are being seen strong due to the continuous improvement in the activity of the manufacturing sector. The share of manufacturing sector in India's GDP is about 17 percent. An economist at HSBC noted the strength in the manufacturing sector as a result of strong demand at home and abroad.

With raw material costs falling to July 2020 lows, the margins of manufacturing companies seem to be increasing. Global demand has also increased to a two-year high, the report claims. Demand is increasing especially from countries like Australia, China, America and UAE.

The increase in the activity in the manufacturing sector is not accompanied by an increase in the recruitment of employees. The report also noted that most of the companies that participated in the survey said that the number of staff was sufficient. As inflationary pressure eases, companies have also considered stockpiling of raw materials.