Manufacturing PMI for Aug 2013 Contracts, Lowest Since 2009

By |September 2nd, 2013|

India’s Manufacturing Purchasing Managers Index (PMI) came in below 50 for August 2013, the first sub-50 level (indicating contraction) since 2009. The number came in at 48.5.

Manufacturing PMI for Aug 2013

Remember that in July the Services PMI had contracted. The Services PMI for August will be released on Tuesday.

The PMI has, in general, tracked the manufacturing sector a bit better than IIP. Even this one turns ominous now.

July PMI for 2013 Contracts, A Four Year Low

By |August 5th, 2013|

India’s Purchasing Managers Index (PMI) for July 2013 came in at 48.4 (composite of Manufacturing and Services) the lowest since 2009.

HSBC India Composite Output PMI Jul 2013


Numbers below 50 indicate contraction, and while we had a scare of contraction in 2009, we rebounded fast. In the face of scams, a diving rupee and tight liquidity we are likely to go down further.

Gold Shortage, Bad Rating Agencies, Services PMI , Low Auto Sales and the Fun in Greece

By |July 3rd, 2013|

Gold’s trading at a high premium. Get this, RBI. You can’t reduce the consumption of a product by restricting supply, when demand is high. Jewellers are now paying a premium for gold, because their customers want the darn thing. Soon, you will find banks and agencies reimporting gold, against “full margin” and the cost of gold in India will go up again, and so will the current account deficit.

Taibbi says the Rating agencies knew about the subprime damage and documentary evidence shows they purposely looked away. We need to make rating agencies irrelevant. (RBI are you listening? Please remove any “lower” provisioning requirements for “rated” bonds or loans)

India’s Services PMI for June 2013 comes in at 51.7 which takes the composite index to 50.9 from 52 last month.


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July Manufacturing PMI at 50.3 (No-Change)

By |July 1st, 2013|

The HSBC Markit Purchasing Managers’ Index (PMI) is at 50.3 and stagnant from last month’s 50.1. Remember, the numbers above 50 indicate expansion (higher numbers mean a higher rate) and below 50 are contraction.


What the big chief has said:

Manufacturing activity was broadly flat in June. Output continued to contract due to power shortages, albeit less so than last month. Moreover, new orders contracted led by weaker domestic demand. At the same time, employment firmed and stocks of finished rose. Despite the moderate pace of growth, output prices picked up slightly and input prices rose more notably, partly in response to the depreciation of Rupee.

So there’s both slowdown and inflation at the same time? Interesting.

May 2013 Manufacturing PMI Falls to 50 Month Low at 50.5

By |June 4th, 2013|

The HSBC Markit Purchasing Managers Index (PMI) for Manufacturing has fallen to 50.5 in May 2013, which is the lowest in over four years.


Given this, and the dramatic fall in GDP, we might actually see the RBI cut rates some more very soon, perhaps even in June. However, bond yields rose about 7 basis points which might indicate the market doesn’t really think so.

Services PMI comes in on Wednesday – that’s been holding up the overall PMI. If that slows down too, it’ll be one more notch down for this indicator.

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April 2013 Composite PMI Lowest Since Oct 2011

By |May 6th, 2013|

The HSBC Markit Purchasing Manager’s Index (PMI) was in for April 2013 today at 50.5, the lowest since October 2011. This composite index is an average of the Manufacturing and Services Indexes. The Manufacturing Index was at 51, released earlier this month and the lowest since Nov 2011.

India PMI for April 2013

What’s above 50 is still expanding, but a number closer to 50 means the expansion is at a lower rate.

What’s also not said but to note is that if the average is 50.5, and the manufacturing index is at 51, then the other component – the services index – is at 50. This means the services index is close to moving into contraction zone.

All indications seem to be of a slowdown, but even in […]

April 2013 PMI At Lowest Since Nov 2011

By |May 2nd, 2013|

The HSBC Markit Purchasing Managers Index (PMI) is at 51.0 for April, the lowest since November 2011. Remember that anything about 50 is “expansion” and below 50 is contraction – so we’re still growing at an increasing rate, just not quite as fast as earlier.


While this sounds bad, the Nifty touched 6,000 again, +1.2%. This could be due to the feeling that the slowing down of the world economy might prod central banks to cut interest rates further – the Feb and ECB meet today, and the RBI meets tomorrow. Indications, from Markit, are similar:

"Manufacturing activity lost momentum again in April,
with output growth slowing further on the back of a
deceleration in domestic orders and […]

India PMI Falls to 54.8, Growth Pace Declines

By |March 6th, 2013|

The HSBC Markit Purchasing Managers Index (PMI) comes in at 54.8, with the service part of the index slowing down while the manufacturing pace increased.


A number above 50 is still expansion but at a slower pace than earlier. Overall, the problem is that input price inflation continues to hurt.

I believe we should see slowing service output impact wages, and then, consumption. Coupled with inflation this is leading to stagflation in the economy. A rise in the stock markets might only be unbridled optimism, since these are macro headwinds which impact the economy in the longer term.

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January PMI Continues Expansion; Services Jump

By |February 6th, 2013|

The HSBC Markit Purchasing Managers Index (PMI) was at 56.3 in Jan 2013, indicating continuing expansion. The Index is based on both Manufacturing and Services inputs. The Manufacturing part the index expanded slower at 53.2 (from 54.7 in Dec), while the services part accelerated faster at 57.5 (from 55.6 in Dec).



According to the release:

  • New (service) orders growth in the private sector at 11 month high 
  • Business activity in the service sector expands at fastest rate in 12 months
  • Private sector employment increases for eleventh month running

I wonder why I’m seeing things totally opposite. Recruitment’s down, orders are running lower. But I don’t have a formal survey.

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India Dec 2012 PMI at a 10 month high

By |January 5th, 2013|

India’s composite Purchasing Managers Index (PMI) – a blend of the inputs from manufacturing and services – shot up to 56.3, a ten month high, reports HSBC/Markit.


Anything about 50 is expansion, so the pace of expansion has increased.

The manufacturing PMI also went up to 54.7

This means the recovery in India is ongoing, if you can trust this data. GDP figures for Q3 (Oct – Dec) 2012-13 should be good, when they come through in February. However, this doesn’t really mean we’re out of the woods, and we’ll have to wait two months to see if this was only a random spike or if it is a real change.

India’s September PMI Shows Expansion at 55.0

By |October 5th, 2012|

The HSBC Market Purchasing Manager’s Index for September is at 55.0, a marginal increase over August’s 54.3. This is a composite indicator consisting of a manufacturing indicator (which is at 52.8) and a services indicator that’s at 55.8. Numbers above 50 show expansion, and below 50, contraction.


There are two immediate problems with this data, just as you consider that it is not impressive enough to show a huge recovery.

1. The services index is based on a single question. I’m like very fond of indexes but based on a single question?

2. I have no idea what a Purchasing Manager is.

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India’s July PMI at 54.4, Marginally Lower

By |August 7th, 2012|

India’s July PMI (Purchasing Manager’s Index) dropped to 54.4, only marginally off the last month’s figure of 55.7. Anything above 50 is expansion so the growth story hasn’t really ebbed. The number is a composite of the services and manufacturing PMIs, the latter of which saw a fall to 52.9 from the 55 levels.


India has been growing for 39 consecutive months. Input inflation it seems has slowed to a 21 month low and it might just seem that money tightness has helped.

At this point, any good news will be taken positively by the market, after such a long period of bad-to-worse news flow. In any event I expect that tiny but non-crucial policy events will occur to encourage investors, until the next crisis. The […]

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June PMI Strong at 55+

By |July 6th, 2012|

The HSBC Markit Purchasing Managers Index (PMI) has shown continued expansion in June, with the manufacturing PMI at 55, and the composite index (consisting of both manufacturing and services) going up to 55.7 from 55.3. For the PMIs, a print below 50 means contraction and above 50 is expansion.


But the comments are interesting:

“While service sector activity grew at a slightly slower pace, new orders grew faster and this should hold up activity in coming months. Moreover, employment picked up, which helped reduce the backlogs of work, and businesses remained relatively optimistic about the outlook for the coming 12 months, although sentiments eased a bit from the previous month. However, the inflation readings for input and output prices were broadly unchanged from May and remain high by historical standards. Together with manufacturing PMI, these numbers suggest that it is […]

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April 2012 Composite PMI Holds Up at 53.8

By |May 4th, 2012|

The April 2012 HSBC-Markit Purchasing Managers Index (PMI) Composite index for India comes in at 53.8, unchanged from last month. (The Manufacturing PMI was 54.9 while Services PMI was 52.8)


The implication is that growth hasn’t stalled and that inflation risks remain high, so RBI won’t continue with the rate cuts. But just one rate cut after 13 hikes? Well, time will tell.

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