India’s private sector activity climbed in August, recovering from an over four-year low as services growth picked up.
The HSBC Flash India Composite PMI, compiled by S&P Global, rose to 54.6 in August from 54.3 in July, above a Reuters poll median estimate of 54.3.
Services businesses drove the gain, reporting a modest re-acceleration in activity and new work after their weakest growth in 53 months in July.
Manufacturing activity continued to soften, with the HSBC Flash India Manufacturing PMI falling for a third straight month to 52.9, its weakest reading in five years.
The composite index stayed above the 50-point mark that separates growth from contraction, though it remained below the roughly 60 average seen earlier this year.
The figures suggest services are supporting India’s overall growth even as manufacturing activity keeps losing steam heading into the closing months of 2026.
The HSBC Flash India Manufacturing PMI fell for a third straight month to 52.9, its weakest reading in five years, even as it stayed above the 50-mark that separates growth from contraction.
Job creation across India’s private sector accelerated to its fastest pace since June 2025, with the services sector leading the pickup in hiring.
Export orders continued to rise at a solid pace in August, with growth reported from markets including the United States, Germany, China, Singapore and Japan.
Input cost inflation eased to its softest level in seven months, giving companies some relief on the pricing front even as overall demand growth remained modest.
Business sentiment for the year ahead improved across both the manufacturing and services sectors compared with July, according to the survey data.
The Reuters poll of economists had pegged the composite PMI at 54.3 for August, meaning the actual reading of 54.6 came in slightly above expectations.
The PMI survey is compiled by S&P Global from responses submitted by private-sector companies each month, and is closely watched as an early indicator of economic momentum ahead of official government data.
Photo by Gnoeee, Wikimedia Commons, CC BY-SA 4.0
