GST pulls down manufacturing PMI to over 8-year low

Manufacturing activities contracted to an eight-and-a-half-year low in July following the goods and service tax (GST) roll-out, showed the widely-tracked Nikkei Purchasing Managers’ Index (PMI) on Tuesday. This led to cutting of jobs, albeit marginally.

Experts said the Reserve Bank of India (RBI) will cut repo rates by at least 25 basis points on Wednesday to spur industrial activity. 

Manufacturing PMI stood at 47.9 points in July, down from 50.9 in June. A reading above 50 indicates expansion, while one below it shows contraction. Factory activities had earlier fallen in December 2016 after demonetisation. 

Implementation of the GST is responsible