India's private sector activity recovers slightly in August
What's the story
India's private sector activity saw a slight recovery in August, according to the latest data from S&P Global. The HSBC Flash India Composite Purchasing Managers' Index (PMI) rose to 54.6 in August, up from July's 52-month low of 54.3. This was higher than the Reuters poll median estimate of 54.3 and indicates an improvement in economic conditions as the reading remained above the neutral mark of 50 that separates growth from contraction.
Sector performance
Services sector drives recovery
The recovery in India's private sector activity was mainly driven by the services sector.
The PMI for this sector rose to 54.5 in August, up from a 53-month low of 53.3 in July.
However, the manufacturing PMI fell for the third consecutive month to 52.9 from 53.5, its lowest since August 2021.
Both goods output and new orders grew at their weakest pace in five years, indicating challenges faced by this sector amid changing market conditions and competitive pressures.
Employment trends
Key challenges for manufacturing sector
In the manufacturing sector, staffing fell for the first time in 2-1/2 years.
However, overall employment accelerated to its joint-fastest pace since June 2025, driven by a 15-month-high growth in services-sector hiring.
Input cost pressures eased to a seven-month low but firms raised their selling prices at the fastest rate since April as they tried to pass higher costs on to customers.