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India factory growth hits seven-month high in September

India’s manufacturing sector expanded at its fastest pace in seven months in September. Strong demand ended a three-month slowdown, a private survey showed.

The HSBC India Manufacturing PMI, compiled by S&P Global, jumped to 55.1 in September from 52.8 in August. August was a five-year low. The September reading was the highest since February. A reading above 50 signals growth.

New orders rose at the fastest pace since February. Demand was strong for electronic, food, pharmaceutical and textile products. Export orders also accelerated, with buyers in Brazil, Europe, the UAE and the US.

Output growth hit its strongest since May. Firms bought more materials and built stocks for expected sales. Finished-goods inventories saw their second-largest rise in nearly 12 years.

Hiring resumed. Employment grew at its strongest rate since May, after an outright fall in August. That was the first drop in factory jobs in two and a half years.

Business confidence hit a four-month high. HSBC’s Pranjul Bhandari said firms were preparing for sustained demand.

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