By India’s private sector activity improved slightly in August, moving up from an over four-year low, as services growth rebounded and offset weakness in manufacturing.
The HSBC Flash India Composite PMI, compiled by S&P Global, rose to 54.6 in August from 54.3 in July, above a Reuters poll median estimate of 54.3.
Services firms reported a modest re-acceleration in business activity and new orders, having posted their weakest growth in 53 months just a month earlier.
Manufacturing growth kept losing ground, with the HSBC Flash India Manufacturing PMI slipping for a third straight month to 52.9, its weakest reading in five years.
The composite index stayed above the 50-mark that separates expansion from contraction, though it remained well under the roughly 60 average seen earlier in the year.
The data suggests a two-track economy taking shape, with services providing a cushion even as factory activity continues to decelerate heading into the final months of 2026.
Input cost inflation eased to its softest level in seven months, giving companies some relief on the pricing front even as overall demand growth remained modest.
Business sentiment for the year ahead improved across both the manufacturing and services sectors compared with July, according to the survey data.
The Reuters poll of economists had pegged the composite PMI at 54.3 for August, meaning the actual reading of 54.6 came in slightly above expectations.
The PMI survey is compiled by S&P Global from responses submitted by private-sector companies each month, and is closely watched as an early indicator of economic momentum ahead of official government data.
July’s composite reading of 54.3 was itself the weakest in over four years, making August’s modest uptick to 54.6 a break from what had been a multi-month slowing trend.
The HSBC Flash India Manufacturing PMI fell for a third straight month to 52.9, its weakest reading in five years, even as it stayed above the 50-mark that separates growth from contraction.
Photo by Gnoeee, Wikimedia Commons, CC BY-SA 4.0
