New Delhi, Jan 2 (UNI) India’s manufacturing sector continued to expand in December, albeit at a slower pace, as the HSBC Manufacturing Purchasing Managers’ Index (PMI) slipped to 55.0 from 56.6 in November, marking its lowest level in 38 months, data released by S&P Global showed.
Despite the decline, the index remained well above the 50 threshold that separates growth from contraction, indicating that overall operating conditions in the sector stayed positive.
New business orders continued to rise at a strong pace in December, though the rate of growth was the weakest since December 2023.
Factory output also expanded, but at its slowest pace since October 2022. The moderation in growth led manufacturers to adopt a more cautious approach to purchasing raw materials, even as overall input buying continued to increase.
Export demand showed signs of softening during the month, with growth in international orders easing to the slowest pace in 14 months.
Manufacturers reporting higher export sales attributed the improvement mainly to stronger demand from Asia, Europe, and West Asia. With reduced pressure on production capacity, hiring activity slowed.
Manufacturers added only a small number of workers in December, with job creation recording its weakest pace since the current growth phase began in March 2024.
Levels of unfinished work edged up slightly, suggesting that firms were largely able to manage workloads with existing capacity.
Looking ahead, manufacturers remained optimistic about output growth in 2026, although business confidence declined to its lowest level in nearly three-and-a-half years.
While advertising efforts, steady demand, and new product launches continued to support sentiment, some firms expressed concerns over intense competition and ongoing market uncertainty.
