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Manufacturing contracts in July
Why is it in news?
- A monthly survey showed that India’s manufacturing sector activity contracted at a slightly faster pace in July.
Details:
- This is the fourth straight month of contraction for the Indian manufacturing sector.
- The IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) stood at 46 in July, down from 47.2 in June.
- In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.
Causes behind the Contraction:
- Demand conditions remained subdued due to lockdown extensions.
- Export orders witnessed a decline.
- The firms reduced both staff numbers as well as purchasing activity.