In positive developments for the Indian economy, the country’s retail inflation cooled, while industrial production saw an uptick, according to recently released data.
The latest numbers are a breath of fresh air amid economic concerns due to a slowdown in real gross domestic product (GDP) growth noted recently.
to 5.48 per cent in November, down from 6.2 per cent in October, as food prices eased, according to government data released Tuesday (December 10). This marks a decline from a 14-month high, though consumer prices remained above 5 per cent for the third straight month.
Food inflation also slowed, falling to 9 per cent in November compared to 10.9 per cent the previous month. The moderation in prices comes amid rising economic concerns and ongoing policy adjustments by the Reserve Bank of India (RBI).
The central bank’s monetary policy committee held the policy rate steady for the eleventh consecutive meeting in December, citing persistently high inflation as a key factor. However, the RBI raised its inflation forecast for the fiscal year to 4.8 per cent, up from the earlier projection of 4.5 per cent.
India’s industrial production also showed positive momentum, rising to a three-month high of 3.5 per cent in October, up from 3.1 per cent in September, data from the Index of Industrial Production (IIP) showed.
The growth was driven by a 4.1 per cent increase in manufacturing output, a 2 per cent rise in electricity generation, and a 0.9 per cent uptick in mining activity.
On a year-on-year basis, the October industrial output figures were lower compared to the same period last year, when manufacturing, electricity, and mining grew by 10.6 per cent, 20.4 per cent, and 13.1 per cent, respectively. The indices for October 2024 stood at 147.9 for manufacturing, 207.8 for electricity, and 128.5 for mining.
From April to October, industrial output rose by 4 per cent, a slowdown from 7 per cent in the same period last year, reflecting broader economic pressures.
These developments come as India grapples with a seven-quarter low in real GDP growth, which fell to 5.4 per cent in the July-September period, down from 6.7 per cent in the previous quarter. Gross Value Added (GVA) growth also slowed to 5.8 per cent from 6.8 per cent in Q1.
Further cooling in consumer prices is expected in the coming months.
With inputs from agencies
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India’s retail inflation eases to 5.48%, industrial production rises to 3-month high
