Here comes India’s manufacturing output data and the news is not good

Amid difficult economic climate, India’s manufacturing sector output slipped to a seven-month low of 51.2 in September, down from 52.3 in August.

A Nikkei survey stated that the order flow turned sluggish in its Nikkei India Manufacturing PMI, a composite monthly indicator of manufacturing performance.

"Despite having been supported by sustained increases in new work, growth of Indian manufacturing production in September was weighed down by a difficult economic climate," Pollyanna De Lima, Economist at Markit and author of the report, said.

Lima added that as per PMI data, the manufacturing sector looks set to provide a stronger contribution to GDP than it did in the April-June quarter.

PMI was weighed down over slower increases in new orders and output.

"Slower increases in new business inflows have hindered firms' ability to recruit. The sector's labour market was squeezed in September as companies attempted to minimize operating costs," Lima said.

Moreover, the report added that input costs eased for the second consecutive month and Indian manufacturers passed lower input costs on to clients.

Meanwhile, RBI Governor Raghuram Rajan announced a repo rate cut of 50 basis points to boost the economy.

The central bank also lowered its economic growth forecast for the current fiscal from 7.6% to 7.4%.