Bookmark Kaumudi Online  Bookmark this site  Editor@Kaumudi  |  Marketing  Print Advt rates  |  Calendar 2012        Go!    
 
 
January 20, Friday 2017 11:12 AM       

       HEADLINES: Permission given to carry body of Santhosh in procession                                              Kodiyeri denies party‚Äôs role in murder                                              Divorce granted by church court can't override law: SC                                              NIA says LeT behind Uri, Handwara attacks                                              LCA Tejas to take maiden R-Day flight                                              'Jallikattu' stir spreads to Lanka, UK and Australia                                              Pak parl committee seeks fund to enhance security of FO                                              Saina, Jayaram reach quarterfinals in Malaysia Masters                                              Probably one of my best innings, says Yuvraj Singh                                              Kaumudi Facebook
       BUSINESS Next Article: Sensex begins 2017 on negative note, down 132 points  
       Manufacturing slips into contraction on cash crunch: PMI data
 
         Posted on :16:37:30 Jan 2, 2017
   
A A
       Last edited on:16:37:30 Jan 2, 2017
         Tags: Manufacturing slips, cash crunch, PMI data
 
NEW DELHI: Hit hard by the demonetisation move, manufacturing sector plunged into contraction in December -- the first shrinkage in a year -- as cash crunch took its toll on new business orders and factory output, a monthly survey showed today.
 
The Nikkei Markit India Manufacturing Purchasing Managers' Index (PMI) -- which measures manufacturing sector activity -- fell to 49.6, down from 52.3 in November.
 
The index slipped below the crucial 50 threshold -- which separates contraction from expansion -- for the first time since December 2015. This also marked the biggest month-on- month decline in the index in over eight years or since November 2008 when the global economy had slipped into a severe downturn post Lehman collapse.
 
"Having held its ground in November, following the unexpected withdrawal of Rs 500 and 1,000 bank notes from circulation, India's manufacturing industry slid into contraction at the end of 2016," said Pollyanna De Lima, Economist at IHS Markit and author of the report.
 
Lima added that "cash flow issues among firms also led to reductions in purchasing activity and employment".
 
Survey participants widely blamed the withdrawal of high-value rupee notes for the downturn as cash shortage in the economy reportedly resulted in fewer levels of new orders.
 
Businesses also highlighted challenging conditions in external markets, with a fall in new businesses from abroad ending a six-month long growth.
 
Though December saw a mild decline in manufacturing output, the average reading for October-December remained in the "growth terrain", suggesting a positive contribution from the sector to overall GDP in the third quarter of 2016-17, the survey said.
 
Several researchers and economists have lowered their near-term GDP growth forecasts in the wake of the demonetisation move, though there is a broader view that the decision would help the economy grow faster in longer run.
 
"With the window for exchanging notes having closed at the end of December, January data will be key in showing whether the sector will see a quick rebound," Lima added.
 
The report said the higher prices paid for a range of raw materials made average cost burden increase for the 15th straight month in December, with the rate of inflation picking up since November.
A A
       BUSINESS
Next Article: Sensex begins 2017 on negative note, down 132 points
 
 
BUSINESS HEADLINES
Right time to invest in India: Gadkari  
Autonomy impinged, protest RBI staff  
Will continue my association with TCS: Chandra to employees  
RBI may cut repo rate by 25 basis points in Feb: HSBC report  
SpiceJet strikes Rs 1.5 L cr deal with Boeing for 205 planes  
Retail inflation hits 3-year low of 3.41%  
TCS names Rajesh Gopinathan as MD and CEO  
Factory output grows 5.7 pc in Nov, shrugs off slowdown fears  
TCS Q3 net profit up 11% to Rs 6,778 cr  
Demonetisation, GST to make society tax compliant: Jaitley  
Patel urges govt to rein in borrowings, inflation  
GoAir firms up order for 72 A320 neo planes worth Rs 52,000 cr  
Nano project led to Gujarat as car mfg hub: Ratan Tata  
Yahoo Chief Mayer to leave company board after Verizon sale  
Auto sales at 16-yr low in Dec as demonetisation takes toll  
FM cites higher tax mop up to dismiss economic slowdown fears  
Demonetisation just a bump; India to maintain 7% growth: Cisco  
Volkswagen defies 'dieselgate' to boost sales in 2016  
'Despite demonetisation, India to grow faster than China'  
Apple cuts Tim Cook's pay as iPhone sales fall first time  
Govt clears 26% stake sale in BEML  
NRIs can deposit old banknotes till June 30  
Sensex ends 119 down after hitting 27k, IT stocks melt  
Reserve Bank unlikely to cut key rate in February: Report  
Gold maintains uptrend, hits 1-month high  
 
Azharuddin's nomination for HCA president's post was rejected. Do you agree to this?
Yes
 
No
 
Don't know
 
 
 
Home Kerala India World Business Sports Sci&Tech Education Automobile CityNews Movies Environment Letters 
© Copyright keralakaumudi Online 2011  |  Reproduction in whole or in part without written permission is prohibited.
Head Office Address: Kaumudi Buildings, Pettah P.O, Trivandrum - 695024, India.
Online queries talk to Deepu Sasidharan, + 91 98472 38959 or Email deepu[at]kaumudi.com
Customer Service -Advertisement Disclaimer Statement   |  Copyright Policy