New Delhi : Manufacturing sector grew at its fastest pace in four months in July on surge in new orders, though job market remained muted and inflationary pressure was subdued — leaving room for RBI Governor Raghuram Rajan to cut rates as a parting gift, a monthly PMI survey showed on Monday. The Nikkei Markit India Manufacturing Purchasing Managers’ Index (PMI) – a composite indicator of manufacturing performance – rose to 51.8 in July from 51.7 in June. A reading above 50 denotes expansion while one below means contraction.
“India’s manufacturing economy is reviving at the beginning of the second half of 2016 after the slowdown seen in April-June quarter, as growth of both production and new orders continues to strengthen in July,” said Pollyanna De Lima, Economist at Markit and author of the report. Supported by greater demand from both domestic and external markets, new business orders rose at the fastest pace since March, reports PTI. Although factory output also expanded at the fastest rate since March and backlog accumulation intensified, businesses refrained from creating jobs. Only one per cent of the surveyed companies took on additional workers in July and almost all the remaining respondents signalled no change in payroll numbers.
