Covid-19 impact: India services PMI falls to lowest ever in April

India’s services activity collapses as coronavirus palayses global economy -PMI

India’s services activity suffered a shock collapse in April as the coronavirus lockdown crippled global demand, causing a historic spike in layoffs and reinforcing fears of a deep recession in Asia’s third-largest economy, a private survey showed. The grim result for the industry, the engine of economic growth and jobs, underlined the pandemic’s sweeping impact across India as authorities extended a nationwide lockdown, in effect since March 28, until May 17.

The Nikkei/IHS Markit Services Purchasing Managers’ Index plunged to an eye-popping 5.4 in April from March’s 49.3, an unprecedented contraction since the survey first began over 14 years ago. It also shattered a Reuters poll forecast of 40 and was way off the 50-level separating growth from contraction, with the single-digit outcome marking by far the most extreme result among major economies. “The extreme slide in the headline index, which fell by over 40 points, shows us that the strict lockdown measures have led to the sector essentially grinding to a complete standstill,” Joe Hayes, an economist at IHS Markit, said in a release.

The steep downturn in activity underlined the widespread havoc wrought by the pandemic worldwide, with many fearing the worst global recession since the 1930s. All of the survey’s key gauges plummeted. An index measuring foreign demand for services ceased to an unprecedented 0.0, while an overall demand index also fell to an historic low and firms laid off workers at the quickest clip ever…Read More

Manufacturing PMI improves to 51.2 in Nov, but demand remains subdued

Although business conditions in the Indian manufacturing sector improved in November, the rise, however, remained subdued compared to earlier this year and the survey history, the study said.

The country’s manufacturing sector activity inched up in November, but the upturn remained subdued as growth rates for new orders as well as production were modest, a monthly survey said on Monday. The IHS Markit India Manufacturing PMI rose to 51.2 in November from 50.6 in October, when it had fallen to a two-year low, indicating only a slight improvement in the health of the sector.

Although business conditions in the Indian manufacturing sector improved in November, the rise, however, remained subdued compared to earlier this year and the survey history, the study said. This is the 28th consecutive month that the manufacturing PMI has remained above the 50-point mark. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

“After pulling back noticeably in October, manufacturing sector growth displayed a welcoming acceleration in November. Still, rates of expansion in factory orders, production and exports remained far away from those recorded at the start of 2019, with subdued underlying demand largely blamed for this,” said Pollyanna de Lima, Principal Economist at IHS Markit. According to the survey, growth of manufacturing activity in November was supported by the launch of new products and better demand, though restrained by competitive pressures and unstable market conditions…Read More