Markit US Manufacturing PMI Weakens in August

Markit US Manufacturing PMI Weakens in August

The Nikkei India Manufacturing Purchasing Managers' Index (PMI) rebounded to 51.2 in August from a low of 47.9 in the previous month, indicating a substantial turnaround from July's contraction amid confusion over the new GST (Goods and Services Tax) regime. Readings above 50 indicate expansion, while anything below 50 indicates contraction.

The strongest euro exchange rate in two and a half years did little to dent demand for French-made goods as the flow of new orders and backlogs of work grew, the survey showed.

New orders rose for the 33rd consecutive month, while strong demand in Asia helped new export business to rise at its fastest pace since May 2010.

Data indicated that the level of employment in the Dutch manufacturing sector continued to rise in August.

The Commerce Department raised its estimate of second-quarter GDP growth to an annual rate of 3% from 2.6% previously, beating economists' forecasts of 2.8%.

The rate of growth was little changed from July's five-month high.

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Europe's manufacturing PMI is expected to show hardy growth, with economists forecasting a headline reading of 57.4%, the same as in July.

While input price inflation remained solid, strong client demand boosted manufacturers' pricing power, leading to higher factory gate prices on average, the survey showed.

A subdued economic outlook pushed the Reserve Bank of India to cut its interest rates by 25 basis points in August, but the central bank maintained its neutral stance and said inflation data would drive its future policy moves.

Sustained growth in new orders led firms to expand their production schedules again in August.

India's services sector also gathered steam in the latest quarter and capital investments also bounced back from contraction in the March quarter. However, nearly 31% of companies said they experienced an increase in the price of materials required for their operations, generally linked to the rising cost of commodities.

Business optimism rose to a three-month high.

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