REUTERS - India's manufacturing sector grew at its weakest pace in over two years in November as demand and output continued to soften, a business survey showed on Tuesday.
Nikkei's Manufacturing Purchasing Managers' Index, compiled by Markit, fell to a 25-month low of 50.3 in November from October's 50.7. A reading above 50 indicates expansion.
The output sub-index fell to 50.4 from 51.2 the previous month as domestic demand remained weak.
The subdued domestic demand and competitive pressure appeared to slow new orders, whose sub-index fell to a 25-month low of 50.5, from 51.2 in October.
"Signs of the sector slowing have been building up, as growth of both new orders and output has eased in each of the past four months," said Pollyanna De Lima, economist at Markit.
India's economic growth picked up in the July-September quarter, outpacing China on improving domestic demand and manufacturing activity, so the latest survey will make disappointing reading for the government and central bank.
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The Reserve Bank of India is expected to keep policy unchanged this week as it looks to control inflation, which edged up to 5.0 percent in October, leaving it to the government to implement growth policies.
Input prices increased for a second month although firms did not pass on the cost burden fully to consumers.
(Reporting By Krishna Eluri; Editing by Shri Navaratnam)