Manufacturing At 4 Month High, Core Sector Grows
Two sets of data released on Monday pointed towards a mild expansion in industrial output after a dismal set of numbers last month that had shown a marked post festival season slump. India’s manufacturing sector activity posted a reading of 51.1 in January, compared with 49.1 in December and Separately released government data showed the core sector grew a marginal 0.9% in December, reversing the 1.3% contraction in November output. This indicates industrial production growth, as measured by the Index of Industrial Production (IIP), may also bounce back in positive territory after hitting a four-year low of -3.2% in November. The core sector index has a 38% weight in IIP. The mild recovery in the core sector output was largely on the strength of a sharper 6.1% growth in coal output in December and continued robustness in fertilser production (13.1%). Cement output was up 3.2% while electricity generation rose 2.7%. The data come a day before the RBI’s monetary policy review, in which experts do not expect a change in the key policy rates.