Private sector activity rebounds to two-month high in January: Flash PMI

India’s private sector output in January grew at its fastest pace in two months, recovering from December’s 11-month low, as new orders and output rebounded, a private survey said on Friday.

 

HSBC’s flash India Composite Purchasing Managers' Index (PMI), compiled by S&P Global, rose to 59.5 in January, up from a final reading of 57.8 in December. The index has been above 50, a mark that separates growth from contraction, for 54 months straight.

 

Flash PMI is an advance indication of the final Manufacturing, Services and Composite PMI data for a month; it is usually released a week before the final PMI indices are released. Flash PMI is typically based on around 90 per cent of all PMI survey responses received each month and all responses are used in the final release.

 

 

“There were quicker increases in output at manufacturing companies and their services counterparts, with rates of growth broadly similar,” said the survey.

 

The HSBC Flash India Manufacturing PMI rose to 56.8 in January from 55 in December. The latest figure — a weighted average of new orders, output, employment, suppliers’ delivery times and stocks of purchases indices — rose to a three-month high after falling to a two-year low in December.

 

The HSBC Flash India Services PMI Business Activity Index rose to 59.3 in January from December’s 58, which too was 11-month low. “Strengthening demand conditions and aggressive marketing campaigns” pushed up sales, with overall new business intakes also rising at a faster pace in January. Manufacturers noted a quicker upturn than service providers in terms of sales, said the survey.

 

“Growth, as signalled by the HSBC flash PMI, picked up pace for both manufacturing and services. Despite the rise in the manufacturing PMI, January’s figure remained below the 2025 average,” said Pranjul Bhandari, chief India economist at HSBC.

 

S&P Global compiles Flash PMI data from responses to questionnaires sent to survey panels of some 400 manufacturers and 400 service providers. The final manufacturing PMI for January will be released on February 2 and the services and composite PMI figures on February 4.

 

Aggregate international orders in January rose at the quickest pace in four months, soothing concerns about falling international demand.

 

After muted hiring activity in December, job creation resumed in January with the pace broadly aligning with the series trend, said the release. Companies added junior and mid-level employees to their workforce, according to the survey respondents.

 

“After losing some momentum at the end of 2025, new orders rose more rapidly — led by a faster pick-up in domestic orders. Input cost pressures rose quickly, though more for goods producers than for service providers,” Bhandari said.

 

Input prices also picked up in January with a four-month high rate of inflation at the composite level. The combined output prices, in both the sectors, also rose at the highest pace in three months.

 

“Survey participants suggested that rising input, labour and transportation costs were transferred to clients amid efforts to protect margins. They particularly reported greater outlays on food (eggs, meat and vegetables), fuel and steel,” said the survey.