India Composite PMI Falls to Lowest Level Since 2022

The HSBC India Composite PMI fell to 56.5 in March 2026 from 58.9 in February, below market expectations of 58.7, flash estimates showed. This was the weakest expansion in Indian private sector activity since October 2022, as growth moderated across both manufacturing and services amid the ongoing Middle East conflict. Companies cited the war, volatile market conditions, and persistent inflationary pressures as key factors dampening growth. Softer domestic demand weighed on new orders, which increased at the slowest pace in over three years, even as new export orders surged to a record high. Cost pressures intensified, with input costs and selling prices rising at their fastest rates in 45 and seven months, respectively. Despite these challenges, firms remained optimistic about output growth over the next 12 months, citing efficiency improvements, marketing initiatives, and new client inquiries as key drivers of their positive outlook.

The HSBC India Composite PMI rose to 58.9 in February 2026 from 58.4 in the previous month, though it remained slightly below the flash estimate of 59.3. The latest reading marked the strongest expansion since November, supported by a significant improvement in demand conditions. Overall, new order growth remained broadly in line with rates seen around the turn of the year, while job creation accelerated to its fastest level since October. Manufacturing led the expansion, posting sharper gains in both output and sales. In contrast, growth in the services sector moderated, though it remained firmly in expansionary territory. On the price front, both input costs and output charges rose at faster rates, with overall price increases reaching nine- and six-month highs, respectively. Services firms were the primary source of price pressures, reporting stronger cost and charge inflation than their manufacturing counterparts, highlighting persistent underlying demand in the services economy.

The HSBC India Composite PMI increased to 59.3 in February 2026 from a final 58.4 in the previous month, flash data showed. It was the highest reading since last November, amid a quicker upturn in factory production, as growth of services activity was broadly similar to that in January. Output and new orders grew the most in three months, helped by local tourism, marketing initiatives, and rising client enquiries. Foreign sales also grew at the quickest rate since last September. Hiring strengthened to a three-month high, while outstanding business rose for a third month, marking the sharpest rise since July 2025, though the overall accumulation was modest. On the price front, input costs climbed at the steepest rate in 15 months, reflecting mounting pressures that pushed selling prices to a six-month high, above their long-run average. Finally, sentiment hit its strongest level in a year, as firms expressed confidence that investment and marketing efforts will deliver results.