PMI: Manufacturing sector growth slumps, exports hit 13-year low

PMI Survey: India's manufacturing sector growth slowed for second consecutive month in May. At the same time, the region was in an expansion phase with the highest growth in global sales in 13 years. HSBC India's Manufacturing Purchasing Managers' Index (PMI) fell to 57.5 in May from 58.8 in April. However, the Purchasing Managers' Index rose to a 16-year high of 59.1 in March. According to media reports, an index below 50 in the PMI indicates an expansion in manufacturing activity, while a figure below 50 indicates a decline. HSBC's global economist Maitreyi Das said the manufacturing sector was in expansion territory in May. However, its pace has been slow due to a slowdown in new contracts and production. Das attributed the slowdown to reduced working hours amid the scorching heat and rising cost of production. According to the Elections Growth Impact Survey, growth has been hampered by competition and election-related disruptions. Contrary to the overall sales trend, new export contracts increased sharply in May. The increase in international sales was the biggest in 13 years, as manufacturers benefited from customers in many countries in Africa, Asia, the Americas, Europe and the Middle East. March 2005 saw the market cap increase by Rs 12.48 lakh crore due to expectations of NDA government being formed for the third term. The HSBC India Manufacturing PMI is prepared by S&P Global based on responses to questionnaires sent to purchasing managers in a group of around 400 companies. HDFC Bank Debit-Credit Card will not work on June 4-6.