Indian manufacturing keeps booming as Chinese factories start to stabilise

Tim Wallace
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INDIAN manufacturing output growth slowed slightly in February, but remained above its long-term trend rates according to data published yesterday by Markit.

Figures also showed recent declines in China’s manufacturing output slowed, indicating a brighter future for the economy.

The purchasing managers’ index (PMI) figures came in at 56.6 in India, down from January’s eight-month high of 57.5 and demonstrating solid growth in the country.

Despite the growth in output, employment fell and most firms did not report any change in headcount, with panellists reporting a lack of suitable labour.

In China, the PMI rose from 48.8 to 49.6, on an index where any number below 50 represents contraction.

Russia registered modest growth in the month, with a PMI of 50.7, which economists do not expect to improve soon as export orders have fallen for three months in a row and inventories have declined sharply.

“A moderation of hiring growth and a faster decline in stocks of input purchases in February have prompted the Russian manufacturing sector to continue gradually losing growth momentum, in spite of a slightly faster increase in new orders,” said HSBC’s Alexander Morozov.

“Politicians call this stability, but economists are tempted to call this stagnation.”