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Factory Surveys Show U.S. Strength, India Slowdown As War Drives Costs Higher

An energy shock tied to the Iran conflict is pushing up costs worldwide.

Overview

  • U.S. manufacturing, which the ISM said Wednesday rose to 52.7 in March (above 50 signals growth), posted its strongest reading since 2022 as the prices-paid index jumped to 78.3.
  • India’s HSBC Manufacturing PMI fell Thursday to 53.9, a near four‑year low, with input costs at a 43‑month high as firms absorbed much of the increase to keep selling prices in check.
  • Survey comments and fresh PMIs report supply strains linked to the Strait of Hormuz closure, with longer delivery times and shipping blockages; the UAE’s index Friday showed the first supplier delays since 2021.
  • U.S. factory hiring stayed weak, with ISM’s Employment Index at 48.7 as many manufacturers managed headcounts instead of adding staff.
  • Policymakers and economists expect the energy shock to fade, yet higher costs and rerouted shipping raise the risk of broader inflation and slower hiring if disruptions persist.