The manufacturing sector, which has a 75 per cent weight in the IIP, posted 2.6 per cent growth in September 2015 (versus 6.6 per cent in August), while mining grew 3 per cent (3.8 per cent).
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The retail inflation rose to four-month high of 5 per cent in October compared with 4.41 per cent in September this year and 4.62 per cent in October 2014.
The data showed that the cumulative growth during the April-September period stood at 4 per cent compared with 2.9 per cent during the year-ago period.
The mining sector growth was at 3 percent in September 2015 against 0.1 percent in the same month last fiscal.
Number for the first half of the year show that growth in the intermediate goods segment slid down from 2.3% in the last year to 2% in the current year.
Consumer durables growth halved to 8.4% in September from 17% in August; consumer non-durables production contracted by 4.6% in September after a contraction of 1% in August. As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, Index of Industrial Production (IIP) with base 2004-05 for the month of September 2015 stood at 178.0, which is 3.6% higher as compared to the level in the month of September 2014.
Notably, by usage, the capital goods sector slowed down considerably, coming in at 10.5 per cent in September compared to 21.4 per cent in August. The Nikkei Manufacturing Purchasing Managers’ Index (PMI), compiled by Markit, fell to 50.7 in October from September’s 51.2, indicating growth in the manufacturing sector cooled to its slowest in 22 months as domestic demand softened.
However the recovery in investments was unable to sustain the overall growth momentum of industry as the demand for consumer goods sagged sharply in the second quarter. Indirect tax revenue collections rose 36.8% in October from a year ago.
Most private and multilateral institutions have cut their growth projections for India.
“A favorable base effect related to the shift in the festive calendar is likely to lead to a short-lived spike in IIP growth in October 2015”, said Aditi Nayar, a senior economist with the cooperative bank ICRA.
“I expect the Pay Commission increments to give a boost to demand next year”, he added.
The price rise in spices category was higher at 9.82 per cent and for non-alcoholic beverages at 4.31 per cent. Retail food inflation surged to 5.25 per cent from 3.88 per cent in September.
“We were looking at pressures on food”.
One bp is one-hundredth of a percentage point.
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This will be the last set of macro data this year RBI will consider before it heads into its policy review due in December.
