FX.co ★ India Private Sector Growth Strongest Since June 2010

Tuesday's flash survey data from S&P Global highlighted a robust expansion in India's private sector activity, the fastest in almost fourteen years, primarily due to positive demand across manufacturing and services sectors.

The flash HSBC composite output index, which measures the economic health of the manufacturing and services sectors, climbed to 62.2 in April from 61.8 in March, marking an upward trend. Any score above 50 represents sector expansion, thus indicating a significant growth in the private sector.

Consistent strong demand spurred new business, as well as output during April. Notably, the introduction of new orders and output expanded at a rate not seen in nearly fourteen years.

The manufacturing sector, in particular, indicated a more accelerated rate of expansion, with the manufacturing purchasing managers' index maintaining a strong reading of 59.1. Moreover, the services purchasing managers' index rose to 61.7 in April from 61.2 in March.

New export orders achieved by the Indian private sector observed an unprecedented growth rate, the highest since record-keeping began in September 2014. This surge in orders was thanks to robust sales to clients in Africa, Asia, Australia, the Americas, Europe, and the Middle East.

In response to the increased demand, private sector firms moderately increased their staffing in April. Moreover, they boosted their input buying, marking the swiftest growth rate in ten months.

On the pricing spectrum, both overall input costs and output charges observed slower inflation rates. The rate of increase was found to be below its long-term average.

In terms of the future business outlook, there was significant improvement in April, underpinned by strong demand.