By Anant Chandak
BENGALURU, May 1 (Reuters) - India's factory activity
expanded at its quickest pace in four months in April, driven by
solid growth in new orders and output, a private survey showed
on Monday, signaling resilient demand and an encouraging
outlook.
The survey results suggest India will continue to be one of
the fastest-growing major economies despite slowing global
growth that has undermined momentum across several other
countries. The Manufacturing Purchasing Managers' Index compiled by S&P
Global increased to 57.2 last month from March's 56.4, remaining
above the 50-mark separating growth from contraction for a 22nd
month and confounding expectations in a Reuters poll for a fall
to 55.8.
"Reflecting a robust and quicker expansion in new orders,
production growth took another step forward in April. Companies
also benefited from relatively mild price pressures, better
international sales and improving supply-chain conditions,"
Pollyanna De Lima, economics associate director at S&P Global
Market Intelligence, said in a release accompanying the survey.
"It seems like Indian manufacturers have abundant
opportunities to keep powering ahead. Besides seeing the
strongest inflow of new work in 2023 so far, capacities were
expanded through job creation, input buying was lifted."
Both new orders and output grew at their fastest pace since
December, and that helped firms resume hiring during April,
following the first decline in 13 months in March.
Foreign demand also expanded at the fastest pace in four
months in April and optimism improved.
"Manufacturers are certainly upbeat towards growth
prospects, with optimism improving from March's eight-month low
on the back of contracts pending approval, rising client
enquiries, marketing initiatives and evidence of demand
resilience," De Lima said.
The survey showed input costs rose at a faster pace in
April, although improving demand meant firms were able to pass
on some of that burden to customers, suggesting retail inflation
is unlikely to slow significantly anytime soon.
Inflation was expected to average 5.3% this fiscal year and
5.0% next, remaining well above the Reserve Bank of India's 4.0%
medium-term target, a separate Reuters poll found.
(Reporting by Anant Chandak
Editing by Shri Navaratnam)
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