Loss of growth momentum due to a surge in Covid-19 cases as well as high input cost pressure decelerated the pace of new orders and production for India's manufacturing sector in March.
Accordingly, the IHS Markit India Manufacturing PMI report said that firms scaled up production and input buying in line with another upturn in sales, but employment decreased due to the pandemic curbs and a lack of pressure on capacity.
On the price front, the rate of input cost inflation was among the strongest seen over the past three years cited in the report. However, selling prices increased only moderately as companies limited their adjustments to retain a competitive edge and boost sales.
Consequently, the headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) fell from 57.5 in February to a seven-month low of 55.4 in March.
The PMI ranges between 0 and 100, with a reading above 50 indicating an overall increase compared to the previous month.