India’s manufacturing output rose to a six-month high in July, according to the latest Purchasing Managers’ Index (PMI), which was carried out by banking group HSBC and the Markit (
www.markit.com) financial-services group.
The PMI increased to 52.7 from 51.3 in June (a figure above 50 indicates growth). Markit economist Pollyanna De Lima said: “This growth in PMI reflects stronger increases in orders and output. Furthermore, the sector was also boosted by the quickest expansion in export orders since February.”
“The Reserve Bank of India has cut interest rates three times this year to boost the economic recovery. Arun Singh, senior economist at Dun & Bradstreet, said: “The positive PMI number will add to the central bank’s view that a status quo on rates is the correct call.”
Meanwhile, the latest Chinese PMI was 47.8 in July — down from the 49.4 registered in June — and was the weakest reading since 47.7 in July 2013.
A Markit spokesman said: “The July data signals that the downturn in China’s manufacturing sector intensified at the start of the third quarter. Renewed falls in both total new work and new export orders led manufacturers to cut production at the fastest rate since November 2011.”
Julian Evans-Pritchard, China economist at Capital Economics, said that bad weather had been a factor in the July PMI results. He said: “The weak readings partly reflect temporary disruptions to factory activity as a result of a number of tropical storms that hit China’s key manufacturing hubs over the past month.”
Many of China’s export-oriented factories are located in coastal areas in the south and east of the country, which makes them more vulnerable to adverse weather during the summer storm season.