Financial News: Indian Private Sector Growth Slowest In 14 Months

Indian Private Sector Growth Slowest In 14 Months

01/24/2025 - 01:02:00 (RTTNews)

(RTTNews) - India's private sector growth moderated in January to the lowest level in more than a year as a stronger expansion in the manufacturing industry was more than offset by a loss of growth momentum in the service economy, flash data compiled by S&P Global showed on Friday.

The HSBC composite output index dropped to 56.8 in January from 59.3 in December. The expected reading was 59.6. Nonetheless, a score above 50.0 indicates expansion.

The manufacturing Purchasing Managers' Index rose to a 6-month high of 58.0 from 56.4 in the previous month. Meanwhile, the services PMI fell to 56.8 from 59.3 a month ago.

Factory orders grew at the fastest rate in six months, whereas the increase in services new business was the slowest since November 2023. As a result, the overall Indian private sector growth eased at the start of the year.

The private sector secured more international sales, which grew at the steepest pace in six months as both manufacturers and service providers indicated stronger growth in sales than in December amid gains from across the globe, including the Americas, Asia, and Europe.

Private sector employment was the best registered since the comparable data became available in December 2005.

The survey showed that there was an intensification of capacity pressures among private sector companies as outstanding business volumes increased at the fastest rate in nearly two and a half years.

On the price front, price pressures remained elevated at the composite level, driven by the rise in costs for chemicals, labor, leather, meat, rubber, and vegetables. Output charges increased at a marked rate that was quicker than in December.

Looking ahead, business confidence of Indian private sector companies improved in January, reflecting the most optimistic expectations among manufacturers since May.

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