Flash PMI rises to 54.6 in August from July's 52-month low of 54.3

India's private sector activity edged slightly higher in August from an over four-year low as a ​rebound in services growth offset the weakest expansion in ​the factory industry in half a decade, a survey showed.

HSBC's flash India Composite Purchasing Managers' Index (PMI), compiled by S&P Global, rose to 54.6 in August from July's 52-month low of 54.3, higher than a Reuters poll median estimate of 54.3.

While the reading stayed above the 50 mark separating growth from contraction, it remained below the recent average of around 60.

New orders - a key gauge of demand - grew at a faster pace but remained weak compared to the long-term average. ‌Companies cited challenging market conditions, competitive pressures and lower customer requirements as constraints. Export orders growth, however, slowed from July.

 

Services - the dominant sector - drove this month's rebound. The headline PMI rose to 54.5 in August from a 53-month low of 53.3 in July. Manufacturing PMI fell for the third consecutive month to 52.9 from ​53.5, its lowest since August 2021. Both goods output and new orders grew ‌at their weakest pace in five years.

Staffing in manufacturing fell for the first time in 2-1/2 years. Overall employment, ​however, ‌accelerated to its joint-fastest pace since June 2025 driven by a 15-month-high ‌growth in services-sector hiring.

Overall input cost pressures eased to a seven-month low, but firms raised their selling prices at the fastest ‌rate ​since April in ​efforts to pass higher costs on to customers.

Business confidence for the year ahead edged higher in August. The ‌degree of optimism, ​however, was more modest compared to early 2026.