Lockdowns push manufacturing PMI into contraction mode again

At 46.0 in July, the seasonally adjusted IHS Markit India Manufacturing Purchasing Managers Index (PMI) fell from 47.2 in June, and pointed to a marked deterioration in business conditions across the Indian manufacturing sector.

In June, PMI Index had risen to 47.2 in June as compared with 30.8 in May on a seasonally adjusted basis. (File)

After the rebound in June, the manufacturing sector in India recorded a sharp deterioration in the health amid lockdown extensions in July, according to the IHS Markit survey.

At 46.0 in July, the seasonally adjusted IHS Markit India Manufacturing Purchasing Managers Index (PMI) fell from 47.2 in June, and pointed to a marked deterioration in business conditions across the Indian manufacturing sector.

The downturn was partially driven by a further contraction in output, it said.

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In June, PMI Index had risen to 47.2 in June as compared with 30.8 in May on a seasonally adjusted basis. A reading below 50 indicates contraction. Many states had announced localized extension of lockdown to tackle the coronavirus infections.

“Output contracted at a slightly faster pace than in June, as demand conditions remained subdued with some businesses still closed amid lockdown extensions. Firms responded by cutting both staff numbers and purchasing activity. However, despite the ongoing negative impact of the coronavirus disease, sentiment towards future activity improved for the second month running,” IHS Markit said.

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