India Manufacturing PMI Hits 5-Year Low at 52.8 in August

India's manufacturing sector expanded at its slowest pace in five years during August, with growth moderating for a third consecutive month due to softer demand, according to a private survey released on Tuesday. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) fell to 52.8 in August from 53.5 in July, marking the weakest improvement in the sector's health since August 2021. A PMI reading above 50 indicates expansion, while a score below 50 signals contraction. The decline, which came in slightly below a preliminary estimate of 52.9, was driven by a slowdown in both new orders and output. New orders grew at their weakest pace in five years, with survey respondents citing difficult market conditions and softer demand for certain products. Output also expanded at its slowest rate in five years. Pranjul Bhandari, chief India economist at HSBC, noted that the final PMI figure extended the decline for a third straight month, signaling that production is still expanding but at a markedly slower pace. The slowdown led to a fractional decline in manufacturing employment, the first contraction in more than two years.