IIP growth rises to 13.8% on jump in capital goods production

Industrial growth accelerated to 13.8 per cent in July from 7.2 per cent in the corresponding month last year, on the back of a 63 per cent jump in capital goods production.

Among the main industry segments, manufacturing activity expanded by 15 per cent from 7.4 per cent a year ago. Mining sector grew by 9.7 per cent from 8.7 per cent while electricity generation growth slowed down to 3.7 per cent when compared to previous 4.2 per cent growth.

Capital goods industry and consumer durable goods production expanded by 22.1 per cent in July, the same rate witnessed a year ago.

The double-digit growth in July is commendable because industrial expansion in the previous month was revised down to 5.67 per cent from the earlier estimates of 7.1 per cent. Industrial growth for the first four months of this fiscal stood at 11.4 per cent from 4.7 per cent a year ago. The country's GDP had grown by 8.8 per cent in the first quarter, against 6 per cent in the April-June period of last fiscal.

The HSBC Market Purchasing Managers' Index, an indicator of manufacturing expansion, was 57.25 in August, a slight decline from the measure for July. Still, August marked the 17th successive month the index was above the 50 mark that divides growth from contraction. The 10-year benchmark yield has risen 22 basis points to 7.94 per cent since the last rate rise in July.

SOURCE: economictimes.indiatimes.com


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Jagdish Bhanushali
DENIP Consultants Pvt.Ltd.