India manufacturing growth jumps to 5-month high in Nov: HSBC PMI

India manufacturing

The survey also showed both input and output prices rose sharply in November, after rising at a slower pace in October.

That could put renewed pressure on India's headline inflation rate which at 7.5 percent in October, is well above the Reserve Bank of India's commonly perceived comfort zone around 5 percent.

"Inflation picked up again as higher raw material prices increased input costs for firms and they had enough pricing power to pass these on to end consumers due to the firm demand conditions," Eskesen said.

The central bank has held interest rates steady since April, citing high price pressures, even as many other central banks around the world have cut rates.

It has, however, cut the cash reserve ratio from 6.00 percent to 4.25 percent between January 2011 and October this year to prevent a potential liquidity crunch in financial markets.

With growth slowing in recent months, the din for a rate cut from financial markets has grown louder. But Eskesen said the PMIs suggest the central bank should not ease rates.

Please read our terms of use before posting comments
TERMS OF USE: The views expressed in comments published on indianexpress.com are those of the comment writer's alone. They do not represent the views or opinions of The Indian Express Group or its staff. Comments are automatically posted live; however, indianexpress.com reserves the right to take it down at any time. We also reserve the right not to publish comments that are abusive, obscene, inflammatory, derogatory or defamatory.