India's HSBC Manufacturing PMI (survey-based gauge of factory activity) fell to 52.9 in August 2026 from 53.5 in July, marking the weakest improvement in manufacturing conditions since August 2021. Output and new orders continued to expand but posted their slowest growth in five years as firms faced challenging market conditions, competitive pressures and softer customer demand. Export orders rose solidly, though more slowly than in July. Purchasing activity increased broadly in line with new-order volumes, while input buying grew at its slowest pace in more than five years, resulting in weaker inventory accumulation. Manufacturing employment declined for the first time in two-and-a-half years. Input-cost inflation eased to a seven-month low, but output-price inflation accelerated to its strongest level since April as companies stepped up efforts to pass higher costs on to customers. Business confidence improved from July amid hopes for better market conditions.