Post COVID cool-off, factory output surges to 13-year high in October

 The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) rose from 56.8 in September to 58.9 in October, and pointed to the strongest improvement in the health of the sector in over a decade.

 In April, the index had slipped into contraction mode, after remaining in the growth territory for 32 consecutive months. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

 “Levels of new orders and output at Indian manufacturers continued to recover from the COVID-19 induced contractions seen earlier in the year, with the PMI results for October highlighting historicallysharp monthly rates of expansion,” said Pollyanna De Lima, Economics Associate Director at IHS Markit.

 Lima further noted that “companies were convinced that the resurgence in sales will be sustained in coming months, as indicated by a strong upturn in input buying amid restocking efforts.”

 Manufacturers indicated that the ongoing relaxation of COVID-19 restrictions, better market conditions and improved demand helped them to secure new work in October.

 On the employment front, the compliance of Centre’s guidelines related to the pandemic caused a further reduction in employment. The fall was the seventh in consecutive months.