Press Esc to close
Tuesday 21 April 2015
News updated at 3:16 PM IST
Weather
Max: 33.4°C
Min : 21.6°C
In Bengaluru
Sunny day

Mfg sector contracts for third consecutive month in Oct: HSBC

New Delhi, Nov 1, 2013, (PTI)
India's manufacturing sector activity contracted for the third straight month in October amid falling levels of production and new orders, as the business climate within the country remained tough, an HSBC survey said today. PTI File Photo.

India's manufacturing sector activity contracted for the third straight month in October amid falling levels of production and new orders, as the business climate within the country remained tough, an HSBC survey said today.

The HSBC India Manufacturing Purchasing Managers' Index (PMI) for the manufacturing industry stood at 49.6, unchanged since September, indicating a third, albeit marginal, successive deterioration of business conditions across the country.

"Manufacturing activity contracted for the third consecutive month in October. Order flows remain weak, despite a bounce-back in export orders after two months of decline. Moreover, businesses continue to cut back purchases and a rise in inventories suggest that output will remain subdued," said Leif Eskesen, Chief Economist for India & ASEAN, HSBC.

Demand for the country's exports improved after drying up for a couple of months, as foreign orders grew for the first time since July.

"Reflective of a sustained reduction in order books, Indian manufacturers lowered their production volumes in October," HSBC said.

It further added that "although modest, the pace of decline accelerated from September.

 Incoming new work also fell at a faster rate, with survey participants commenting on weaker demand and a difficult economic climate. Some firms indicated that the cyclone Phailin had also led to fewer numbers of new orders placed."

"Input price inflation accelerated further despite weak growth backdrop, as effects of the depreciated exchange rate continue to pass through. Saddled with additional costs, firms decided to lift output prices to protect margins. This suggests the RBI has to continue its staring contest with inflation," Eskesen added.

According to HSBC, inflationary pressure persisted in October, with input cost inflation accelerating to a 16-month peak and selling prices rising at the fastest pace since February.

Indicating worsening of the price situation, inflation - wholesale as well as retail - had spurted in September.

While the Wholesale Price Index (WPI) based inflation climbed to 7-month high of 6.46 per cent, the one based on Consumer Price Index (CPI) inched closer to double digit at 9.84 per cent, it said.

The Reserve Bank in its October 29 policy review, hiked the key lending rate by 0.25 per cent to contain inflation in continuation of its hard-line stance.


Go to Top

Photo Gallery
Minister U T Khader and MLA Vasanth Bangera stopping Minister B Ramanath Rai who got angry on ...

Minister U T Khader and MLA Vasanth Bangera stopping Minister B Ramanath Rai who got angry on ...

Yuvraj Singh of Delhi Daredevils plays a shot during their IPL match against Kolkata Knight Rider...

Yuvraj Singh of Delhi Daredevils plays a shot during their IPL match against Kolkata Knight Rider...

Police force at a large number being deployed for Left Front activists 'March to Lalbazar Kolkata...

Police force at a large number being deployed for Left Front activists 'March to Lalbazar Kolkata...

Kolkata Knight Riders players celebrate the wicket of J P Duminy (C) of Delhi Daredevils during ...

Kolkata Knight Riders players celebrate the wicket of J P Duminy (C) of Delhi Daredevils during ...

Traditional elephant fights, elephant races, tug of war and dances mark this festival which coincide

Traditional elephant fights, elephant races, tug of war and dances mark this festival which coincide

Villagers struggle to get drinking water from an almost dried well near Tansa dam, in Shahapur ...

Villagers struggle to get drinking water from an almost dried well near Tansa dam, in Shahapur ...

Prime Minister Narendra Modi at the foundation stone laying ceremony of Dr. Ambedkar International

Prime Minister Narendra Modi at the foundation stone laying ceremony of Dr. Ambedkar International

Narendra Modi talking with BJP veteran LK Advani during 'Garib Kalyan Yojana',...

Narendra Modi talking with BJP veteran LK Advani during 'Garib Kalyan Yojana',...

A view of the Kedarnath Shrine before it reopens on April 24 for general public...

A view of the Kedarnath Shrine before it reopens on April 24 for general public...

Snowed down surroundings of Kedarnath Shrine before it reopens on April 24 for general public...

Snowed down surroundings of Kedarnath Shrine before it reopens on April 24 for general public...

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523