Business activity zooms to an all time high of 65.2 in August: HSBC

Business activity in August

India’s business activity zoomed to an all-time high of 65.2 in August, up from 61.1 in the previous month, according to preliminary results from the HSBC Private Sector PMI.

Manufacturing retained strong momentum, with the sector’s PMI estimated climbing to a near 18-year high of 59.8. The services activity rose to an all-time high of 65.6 from July’s 60.5.

"The services flash PMI touched an all-time high of 65.6, led by a sharp pick up in new business orders, both export and domestic. The manufacturing flash PMI rose further, inching closer to the 60-mark, led by a smart rise in new domestic orders," said Pranjul Bhandari, chief India economist, HSBC.

The index performance was helped by new orders, even as new export orders remained at previous month levels.

“Growth of new export orders, however, remained unchanged at July’s levels. Margins improved as the rise in output prices was much faster than that for input costs,” said Bhandari.

On the jobs front, there was positive news as well, as rate of job growth was higher than long run average.

The positivity spilled over to future expectations as well, with future outlook improving to highest level since March.
“Positive forecasts were underpinned by the demand outlook, anecdotal evidence revealed. Stronger sentiment was seen at both manufacturing and services companies,” HSBC said.

Adding to the positive backdrop, S&P Global Ratings upgraded India’s credit rating from “BBB–“ to “BBB” in August—the first upgrade in nearly 18 years. The ratings agency attributed the upgrade to India’s strong macroeconomic fundamentals.

S&P expects India’s GDP to grow by 6.5 percent in FY26 and accelerate to 6.8 percent over the next three years.