JOIN USManufacturing sector contracted for the first time in 25 months in December as Chennai floods triggered significant decline in output and new orders, a monthly survey showed on Monday.
Painting a gloomier picture, the survey said that the rate of decline was the sharpest in almost seven years.
The Nikkei India Manufacturing PMI, a composite monthly indicator of manufacturing performance, dipped from 50.3 in November to 49.1 in December.
The PMI has slipped below the crucial level of 50.0 for the first time since October 2013. A figure above 50 represents expansion while a reading below this level means contraction.
December’s incessant rainfall in Chennai impacted heavily on the sector, with fall in new work leading the companies to scale back output at the sharpest pace since February 2009, the survey said. Incoming new work has also contracted for the first time since October 2013.
During 2015, the Consumer Price Inflation has remained well under control hovering in the range of 3.66-5.4 per cent so far in 2015, while the industry chambers and some other experts are hopeful that it would keep below six per cent mark in the New Year — a target set by the Reserve Bank.