| Consensus | Actual | Previous | |
|---|---|---|---|
| Year over Year | 9.3% | 10.3% | 5.7% |
Highlights
India's index of industrial production rose 10.3 percent on the year in August, accelerating from growth of 5.7 percent in July. Within the industrial sector, manufacturing output advanced 9.3 percent on the year after an increase of 4.6 percent previously. More up-to-date PMI survey data also indicate that growth in the manufacturing sector strengthened sharply in August before moderating in September.
The Reserve Bank of India left policy rates on hold at 6.50 percent for the fourth consecutive meeting last week. Officials noted that economic activity remains resilient and that the risks to the growth outlook are evenly balanced, forecasting GDP growth of 6.5 percent in the current fiscal year. The further strength in activity shown in today's data suggests upside risks to the inflation outlook will remain their primary concern in upcoming policy meetings.
The Reserve Bank of India left policy rates on hold at 6.50 percent for the fourth consecutive meeting last week. Officials noted that economic activity remains resilient and that the risks to the growth outlook are evenly balanced, forecasting GDP growth of 6.5 percent in the current fiscal year. The further strength in activity shown in today's data suggests upside risks to the inflation outlook will remain their primary concern in upcoming policy meetings.
Market Consensus Before Announcement
Year-over-year industrial production growth is expected to rise to 9.3 percent in August versus growth of 5.7 percent in July.
Definition
Industrial production measures the physical output of the nation's factories, mines and utilities. Data are not seasonally adjusted and the main is on the annual growth rate of total industrial production and, within that, manufacturing output. The report is usually released around six weeks after the end of the reference month.
Description
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
The index is a quantitative index with the production of the items being expressed in physical terms. The Index is compiled by taking into account the quantities of items produced during the current month, compared with the average monthly production in the base year. Selection of items is based on the total production of the items as the primary (main) product as well as secondary (by) product. Data are available monthly within six weeks of reference month.
The index is a quantitative index with the production of the items being expressed in physical terms. The Index is compiled by taking into account the quantities of items produced during the current month, compared with the average monthly production in the base year. Selection of items is based on the total production of the items as the primary (main) product as well as secondary (by) product. Data are available monthly within six weeks of reference month.
