India's Private Sector Growth Hits 3-Month High
Analysis based on 11 articles · First reported Feb 20, 2026 · Last updated Feb 20, 2026
The strong economic data from India, particularly in manufacturing, suggests a resilient economy, which is positive for markets. However, intensifying inflationary pressures could lead to a cautious monetary policy from the India===Reserve Bank of India, potentially impacting interest-rate sensitive sectors.
India's private sector activity accelerated to a three-month high in February, with the HSBC flash India Composite Purchasing Managers' Index (PMI) rising to 59.3 from 58.4 in January. This expansion was primarily driven by robust manufacturing performance and strong domestic demand, with new orders increasing at the quickest pace since November and international sales also rising. While services growth remained broadly steady, it saw a notable acceleration in new export business. The improved sales momentum led to a faster pace of hiring and increased business optimism. However, the survey also highlighted intensifying inflationary pressures, with input costs rising at their fastest rate in 15 months and overall output charge inflation hitting a six-month high. This combination of solid growth and rising costs is expected to keep the India===Reserve Bank of India cautious, with expectations that it will hold its key policy rate at 5.25% this year.
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