look news india
Mumbai: The country's manufacturing sector activity fell to a three-month low in August as demand declined significantly. The declining activity in the manufacturing sector has raised doubts over the continuation of the country's economic growth rate in the current financial year.
In the June quarter of the current financial year, the country's economic growth rate declined to 6.70 percent. However, the reason for this decline is believed to be the Lok Sabha elections. Due to the elections, expenditure on infrastructure decreased.
The HSBC Purchasing Managers' Index (PMI) for the manufacturing sector compiled by S&P Global stood at 57.50 last month, up from 58.10 in July.
However, the PMI has remained consistently above 50 since July 2021. An index above 50 is considered expansion in that sector. The new orders sub-index also weakened to a seven-month low. Export demand has seen the lowest growth since January.
Spending pressures are at their lowest since March this year, but commodity price hikes remain close to July's 11-year high. As a result of volatility in demand, companies pass on additional costs to consumers.
Companies continued to add employees for the sixth consecutive month in August amid renewed business optimism. However, the pace of additions has been slow.