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India Manufacturing Shrinks for 1st Time in 11 Months

By Rahul Kamat,

Added 01 July 2021

The latest reading pointed to the first contraction in the manufacturing sector since July last year, as a harsh resurgence of COVID-19.

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The IHS Markit India Manufacturing PMI fell to 48.1 in June 2021 from 50.8 a month earlier. The latest results highlighted the first contraction in the manufacturing sector since July last year, as a harsh resurgence of COVID-19 and stricter lockdown measures negatively impacted demand. Both output and new orders shrank. New export orders decreased for the first time in ten months. Also, buying levels dropped the most since the series began in March 2005. At the same time, employment fell marginally, with backlogs decreasing for the second consecutive month. June data continued to signal to lengthen supplier delivery times, with vendor performance worsening for the fourth straight month. Prices data showed input cost inflation eased to a five-month low while selling prices inflation slowed to a three-month low. Lastly, confidence dropped over uncertainty when the pandemic can be brought under control.

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