India's index of industrial production rose 2.9 percent on the year in February, slowing from growth of 5.0 percent in January. Within the industrial sector, manufacturing output advanced 2.9 percent on the year after an increase of 5.5 percent previously. More up-to-date PMI survey data published previously indicated that conditions in the manufacturing sector slowed sharply in February buyt then rebounded in March. Mining and electricity output rose 1.6 percent and 3.6 percent on the year respectively in February after advancing 4.4 percent and 2.4 percent respectively in January.

The Reserve Bank of India cut policy rates by 25 basis points to 6.00 percent at their most recent meeting earlier in the week. Officials expect household consumption to remain robust but expressed caution about external risks to the growth outlook. Officials also announced that they would shift the policy stance from"neutral" to"accommodative" and advised that they would monitor developments closely to assess what further policy action may be required.

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.

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.