India's manufacturing growth slows to 53.9% in June

India s manufacturing PMI went down from 54.6 in May to 53.9 in June, its lowest since September, according to ratings agency S&P Global. S&P said in its monthly forecast that while the country s manufacturing sector saw growth due to robust demand, it was marred by the rise of input costs and inflation concerns.

It said that softer increases in production, factory orders, stock of purchases and employment dragged down the PMI in June, as well as an improvement in supplier performance that is inverted before entering the calculation. The agency said that growth was restricted due to acute inflation pressures and there was an increase in production attributable to an increase in demand.

The June PMI data was a reflection of a three month low in purchase prices and output charge inflation, according to the agency. The companies that are closely watched in industries like chemicals, electronics, energy, metals, and textiles have seen an increase in input costs, which these companies passed on to clients by hiking selling prices.

S&P Global Market Intelligence Economics Associate Director Pollyanna De Lima said there was a slowdown in growth across a number of measures, such as factory orders, production, exports, input buying and employment, as clients and businesses were unable to spend due to inflation. She added that companies remained very concerned about inflation, a factor that dragged down business confidence to a 27 month low.