📷 Image Credits: Moneycontrol
The private sector in India saw a significant surge in business activity in June, with a rise in the Composite Output Index to 60.9 from the previous month’s 60.5. According to a recent private survey, the momentum in the manufacturing sector helped drive this increase, with new orders showing growth for both sectors. The Global Economist at HSBC, Maitreyi Das, noted that capacity pressures led firms to increase employment levels, marking the fastest pace of employment growth in 18 years.
The report also highlighted that growth strengthened in both manufacturing and service sectors, with a faster upturn among manufacturers. Despite a slight slowdown in export orders, new orders expanded at a faster rate in June, resulting in continued growth for the private sector. Manufacturing activity saw a rise to 58.5 in June, up from 57.5 the previous month, while services increased to 60.4 from 60.2.
The Flash India Composite Output Index, which remained above the 50 mark indicating expansion, recorded data from 800 firms across manufacturing and services industries. Final numbers for the month will be released in the first week of July. While input inflation softened in June compared to the previous month, output prices for goods manufacturers rose at a faster pace compared to the previous 12 months.
Furthermore, reports suggest that the Indian economy is expected to perform better in FY25 than previously projected, with Fitch Ratings revising the growth forecast to 7.2 percent from 7 percent. Business confidence, although dipping to a three-month low, remained positive in June. Firms are optimistic about the impact of marketing efforts and positive demand momentum on the economy. The Reserve Bank of India also expects the economy to expand by 7.2 percent in the current fiscal year, down from 8.2 percent last year.
