India's manufacturing, services growth outpaced China in May: HSBC

[Chanakya's_Chant]

India's manufacturing, services growth outpaced China in May: HSBC

New business orders across emerging market economies increased at a slightly faster pace in May. (TOI photo)​

NEW DELHI: Manufacturing and services sectors in India expanded at a faster rate than China's in May even as emerging market output remained stuck in "low gear", an HSBC survey said on Friday.

The HSBC Emerging Markets Index (EMI), a monthly indicator derived from Purchasing Managers' Index surveys, inched up to 50.6 in May from 50.4 in April, indicating weak output growth across global emerging markets.

While the EMI stood at 50.6 in May, the developed world's PMI was at 55.4 during the month.

"While the former (EMI) points to an ongoing languor that has plagued the emerging markets over the past year, the developed world has moved into a higher gear and is now enjoying it strongest growth for just over three years," Markit Chief Economist Chris Williamson said.

During May, the HSBC composite index for India, which maps both manufacturing and services, stood at 50.7, whereas for China it was 50.2, Brazil 49.8 and Russia 47.1. An index measure of above 50 indicates expansion.

"Disappointing performances continued to be seen across the four largest emerging markets in May. The only good news is that China and India both returned to growth, although in both cases the rate of expansion was only very weak. Brazil and Russia meanwhile continued to contract," Williamson said.

Williamson further said that "an ongoing near-stagnation means the emerging markets are, as a whole, underperforming the developed world to the greatest extent ever recorded by the PMI surveys".

New business orders across emerging market economies increased at a slightly faster pace in May. Meanwhile, employment declined further, and at the strongest rate since June 2009.

On price rise HSBC said, inflationary pressures remained subdued in May, with input price inflation unchanged from April's ten-month low. Moreover, prices charged increased at the strongest rate in five months, albeit only marginally, HSBC said.

Meanwhile, the HSBC Emerging Markets Future Output Index that tracks firms' expectations for activity over the next 12 months, fell sharply to a new low in May, with sentiment in the service sector notably weak.

Source:- India's manufacturing, services growth outpaces China: HSBC - The Times of India

 

[cirr]

PMI is a relative index。

China's manufacturing is growing at an annual rate of some 10% as it is。A PMI reading above 50 means that there is room for further expansion in the months to come。

India's manufacturing growth is close to zero or worse，negative。 And a PMI reading above 50 means the situation may improve a bit in the future。For India，any PMI reading below 55 is really really disaster. The country needs to see a PMI reading over 60 or even 65 to register a meaningful growth in manufacturing。

Ditto for the service(non-manufacturing) PMI.

 

[Chinese-Dragon]

PMI is a "relative" measure.

What is the ACTUAL growth rate of Indian manufacturing? Didn't it shrink in the last quarter?

While the EMI stood at 50.6 in May, the developed world's PMI was at 55.4 during the month.

^^^ According to PMI, the "developed world's" manufacturing is booming!

Yet their actual growth is zero or negative? Like I said, PMI is a "relative" measure.