​​​
  1. Double bonanza for economy: Macros improve as inflation down, factory output up

Double bonanza for economy: Macros improve as inflation down, factory output up

Industrial production has made a remarkable growth at 4.3% defying slowdown from previous month's 1.2%.

By: | Updated: October 12, 2017 6:33 PM
rbi, Economic slowdown, narendra modi, economic growth, Urjit Patel, rbi governor Urjit Patel, india, india growth, reserve bank of india, rbi monetory policy Industrial production has made a remarkable growth at 4.3% defying slowdown from previous month’s 1.2%. (Image: Reuters)

It is a twin bonanza for the economy as the Consumer Price Index (CPI) for September has gone down and the industrial production for July has made a remarkable growth defying slowdown from the previous month. The CPI Inflation for September was recorded 3.28%, down from previous month’s 3.36% mainly due to fall in food prices post monsoon.

The industrial production, which grew a meagre 1.2%, bearing the brunt of a dismal show of the manufacturing sector, made a remarkable comeback at 4.3%. Both CPI and IIP defied conservative predictions, including ET Now’s, which had predicted CPI to rise 3.4% and IIP to rise 2.5%. However, the with August’s industrial production at 4.3%, it is inching towards 4.5% growth in July last year.

The mining sector in August grew  9.4% as compared to 4.8% in July, while manufacturing sector grew 3.1% as compared to 0.1% in the previous month. The electricity sector also rose with its output at 8.3% as compared to  6.5% in July. Primary goods output was 7.1%, up from 2.3% in July. Capital goods output grew 5.4% from -1% in the previous month.

In August, the inflation accelerated to 3.36% on the back of a surge in food prices during the period. The Reserve Bank of India kept the repo rate unchanged last at 6% in its latest credit and monetary policy review, given the predictions of rising headline inflation. The central bank kept the policy stance neutral with the objective of limiting the medium-term target for CPI of 4% within a band of plus/minus 2%, while supporting growth.The lower inflation may now put pressure on the RBI to cut rates in its next monetary policy meeting.

The CPI food inflation fell to 1.25% in September from 1.52% in August. However, CPI fuel and light inflation grew 5.56% as compared to 4.94% in August, and CPI clothing & footwear at 4.63% as compared to 4.58% in August. While the CPI rural inflation has gone down from 3.22% in August to 3.15% in September, the urban inflation has gone up from 3.35% in August to 3.44% in September.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Go to Top