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Manufacturing PMI in February
Why is it in the news?
- According to a private sector survey, manufacturing activity expanded to a 14-month high of 54.3 in February.
- The rise is said to be due to increases in sales, output, and employment.
More about the scheme
- The Nikkei India Manufacturing Purchasing Managers' Index rose to 54.3 in February, from 53.9 in January, amid a robust improvement in business conditions.
- A reading over 50 denotes an expansion in activity and one below 50 shows a contraction.
- As per the report, supportive government policies and strengthening demand conditions resulted in an expansion in the inflow of new work orders.
- The increase was the sixteenth in as many months and the most pronounced since October 2016.
- Goods producers sought to expand output capacities to meet strengthening demand from both domestic and external sources.
PMI Index
- PMI or a Purchasing Managers' Index (PMI) is an indicator of business activity- both in the manufacturing and services sectors.
- This index is prepared on the basis of a survey which is conducted among purchasing executives in over 400 companies.
- Index over 50 shows expansion, while below 50 mean contraction.
- Prepared by IHS Markit, this index is widely quoted to explain latest industrial situation in a nation.
Source
The Hindu.