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Below is Perspective on PMI Data for April By Ms. Madhavi Arora, Lead Economist, Emkay Global Financial Services

India PMI: Manufacturing expands amidst inflationary pressures

* India’s manufacturing PMI slightly improved in Apr (54.7 vs 54 earlier), continuing its 10 straight month of expansion amidst global inflationary pressures.

That said, there has been a gradual yet consistent easing in momentum since the beginning of CY22, and high global commodity prices add to downside risks to growth ahead.

* Even as India is still leading the EM Asia pack in PMI, overall business confidence remained subdued by historical standards marred by economic uncertainty and inflation concerns amongst manufacturers.

* Details show that New orders (mainly exports led) and production accelerated in April.

* The employment indicator stayed above 50 for the second time in last five months.  Improving demand had led firms to purchase additional inputs at a rate not seen since Nov, even as their suppliers hiked prices.

This may imply that inventories may rise in coming months, helping reduce pressure on backlogs.

* Inflationary pressures intensified in Apr as higher imported costs led by higher energy prices and global shortage of inputs pushed up input and output cost further, with the output prices index hitting a 12-month high.

Sectors like chemical, electronic component, energy, metal, plastic and textile reported higher input costs than in March.

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