India’s PMI (Nikkei Manufacturing Purchasing Manager’s Index), as compiled by HIS Markit, decreased to 52.3 in July from 53.1 in June. A mark of 50 and over denotes growth while a mark below 50 would spell economic contraction; despite the slight decline, India is set to remain the fastest growing major economy through 2018.
The PMI decline is attributed to a slight weakening in demand and output as global policies added to the market uncertainty while internal domestic policies are also requiring adoption of new tax systems, regulations, and standards. HIS Markit also recently decreased its forecast of India’s real GDP growth to 7.1 percent for fiscal year 2018 due to rising restrictions that may affect expansion including higher oil prices, large capital outflows from emerging markets and tighter domestic monetary policy.