Economy strong with the manufacturing sector activity rebounding
STORIES, ANALYSES, EXPERT VIEWS
The economy ended the first quarter on a strong note with the manufacturing sector activity rebounding in June after two months of deceleration while goods and services tax (GST) collections came in strong.
Passenger car sales rose further in the month from last year's high base. However, the intense heatwave may have adversely impacted some sectors in the quarter. GST collections rose 8% in June to Rs 1.74 lakh crore from Rs 1.61 lakh crore a year earlier.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI) climbed to 58.3 from 57.5 in May led by buoyancy in demand and expansion in new orders that pushed up the hiring rate to its highest in more than 19 years, a private survey showed Monday. A reading above 50 denotes expansion and anything below signifies contraction.
The Indian economy grew by a better-than-expected 8.2% in FY24. The RBI expects a 7.2% rise in GDP in FY25. June quarter GDP numbers will be released at the end of August. “While the PMI number is good, some transient factors may dampen volume indicators in May-June, particularly in sectors affected by the heatwave and dependent on government capex,” said Aditi Nayar, chief economist, ICRA. New export orders increased substantially again in June with companies attributing higher inflows of new work from overseas to better demand from Asia, Australia, Brazil, Canada, Europe and the US, the PMI data showed.
