Indias factories lost momentum in April as output grew at its weakest pace in over four years,but a jump in export orders augured well for the coming months,a survey showed on Thursday.
The HSBC Manufacturing Purchasing Managers Index (PMI) ,fell for the second straight month in April,dipping to 51.0 from 52.0 in March. The reading for April was the lowest since November 2011. The PMI index,which gauges business activity in Indian factories but not its utilities,has held above the watershed 50 level that divides growth from contraction for over four years.
The factory output sub-index fell close to stall speed at 50.2 in April from 51.6 the previous month,and was the weakest showing since March 2009 when the sub-index reading of 49.3 pointed to a contraction. But,a pick up in the export orders index suggests factories could step up production in coming months.
Manufacturing activity lost momentum again in April,with output growth slowing further on the back of a deceleration in domestic orders, said Leif Eskesen,chief India economist at HSBC.
The survey will harden already strong expectations of a cut in interest rates when the Reserve Bank of India presents its review on Friday.