April IIP beats expectations, at 1.4% by -2.3% in March
The India’s Index of Industrial Production, or IIP for April bounced back into the positive zone after two straight months of contraction. The index of industrial production rose 1.4 per cent in April, from a revised 0.75 per cent decline in March.
“It’s good news and more than what the Street expected. But the IIP numbers are likely to remain soft for some more time. Only after the second quarter, we can expect to see some significant growth,” said Mridul Saggar, chief economist at Kotak Securities.
Among the components used to measure industrial production, the manufacturing output rose 0.7 per cent and the mining output grew 3.8 per cent from the year-ago period. The electricity generation for the month jumped 7.1 per cent on a year-on-year basis. The capital goods output however fell 1.3 per cent on a year-on-year basis.
The brightest spot was the consumer durable goods, with its output up 16.9 per cent. The non-durables were down 10.4 per cent.
“Consumer durable demand was higher on stimulus packages like duty reductions. The sixth pay commission has helped boost consumer durable goods,” Saggar said.
He said that it is too early to revise his FY10 GDP growth estimates of 6-6.5 per cent based on the positive April IIP figures. But he did not rule out a reversal in the easy monetary policy stance toward the fourth quarter of FY10.
Comments (1)
The article is usefull for me. I’ll be coming back to your blog.