India’s private sector output grew at its fastest pace in four months, driven by stronger demand in services and manufacturing. Preliminary survey data showed record job growth, helping the economy close 2024 on a high note.
The HSBC December flash India Composite Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 60.7, matching August’s figure. This marked an increase from November’s 58.6. The PMI has stayed above 60 for most of the year, a level of strength not seen since 2008. The 50-point mark separates growth from contraction.
Economist Ines Lam from HSBC attributed December’s manufacturing PMI rise to gains in production, new orders, and employment. “The quickening expansion in new domestic orders points to stronger growth momentum,” Lam said.
Demand growth was most notable in the services sector, where the PMI climbed to 60.8 from November’s 58.4, hitting a four-month high. The manufacturing PMI also rose to 57.4 from 56.5 last month. Service providers saw a surge in sales, with the new business sub-index reaching its highest level since January.
International demand for both goods and services also increased, with goods experiencing a faster rise than services. While India’s economy grew at a slower 5.4% last quarter, easing inflation is expected to support stronger private sector demand in 2025.
