New Delhi: India's manufacturing activity eased to a three-month low in June as growth in new business orders and export demand weakened, softening output expansion, a private survey released Wednesday found.The HSBC Purchasing Managers Index (PMI) compiled by S&P Global fell to 54.2 in June from 55 in May. It stood at 58.4 in June 2025.A reading above 50 indicates expansion while a figure below that signals contraction.Pranjul Bhandari, chief India economist at HSBC, said the moderation suggests demand has cooled slightly after the earlier surge linked to the Middle East conflict."Growth slowed across output, new orders, export orders and employment, with international sales recording their weakest increase since March 2023," she said.The survey also pointed to weakening business confidence. The share of manufacturers expecting output to grow over the next year halved from May, while a larger proportion of firms reported neutral expectations. Overall optimism dropped to a five-month low, amid concerns over demand and market conditions.According to the survey, growth in both output and new orders was the weakest in four years, except for March. While some firms reported an improvement in demand, others cited subdued customer appetite and intense market competition.The slowdown was driven primarily by the capital goods segment, where growth eased sharply. In contrast, consumer and intermediate goods manufacturers recorded faster growth.