The Nikkei manufacturing PMI for India fell...>

INDIA: The Nikkei manufacturing PMI for India fell to 51.0 in March from 52.1 in

February, marking the eighth consecutive month of expansion, although the

releases represented the weakest breadth of expansion since October 2017.

- The employment sub-index saw its first contraction in eight months as firms

shed workers amid an increase in spare capacity. There was also a moderation of

both input and output prices.

- In contrast, the Nikkei services PMI saw a slight uptick to 50.3 from 47.8,

thanks to an increase in new orders. In a similar vein to the manufacturing

survey, price pressures eased slightly.

- From the perspective of India's bond market, both PMI readings were very

positive. The economy continues to grow but not at a pace that suggests

significant rate hikes are coming, while inflationary pressures appear to be

cooling. With the 10-year bond yield currently at 7.29%, almost 300bps above

headline CPI, there remains room for yields to fall even as the RBI maintains

its repurchase rate at 6.00% as is widely anticipated at today's rate meeting.