India business output continues to rise sharply, but growth eases to ten-month low

The HSBC Flash India Composite Output Index posted 58.9 in December, remaining well above the 50.0 no-change mark and therefore signalling a further steep expansion of business activity across the private sector.

That said, the index was down from 59.7 in November and pointed to the softest output growth since February.

The HSBC Flash PMI for December indicated that business activity in the Indian private sector continued to increase sharply in the last month of 2025. That said, the rate of expansion eased, with softer growth seen across both the manufacturing and service sectors. Similarly, growth of new orders slowed at the end of the year, but remained marked.

Meanwhile, companies kept their staffing levels broadly unchanged amid a further easing of business confidence. Inflationary pressures were again muted.

Slower rises in business activity were seen in both the manufacturing and service sectors. The weaker increases in output reflected an easing of growth in new orders, which nonetheless continued to rise sharply amid reports of improving customer demand.

While the pace of expansion in total new orders eased, the rate of growth in new export orders accelerated in December and was at a three-month high.

Looking specifically at manufacturing, weaker rises in output and new orders were accompanied by softer expansions in employment and stocks of purchases, plus a greater shortening of suppliers' delivery times. As a result, the HSBC Flash India Manufacturing PMI posted 55.7 in December, down from 56.6 in November.

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