India’s index for industrial production (IIP), for April grew by a meagre 0.1 percent, below market expectations, giving rise to fresh hopes of an interest rate cut by the Reserve Bank of India on 18 June at its monetary policy review.
In March, the index had declined by 3.5 percent. The core sector output for April was 2.2 percent, the government data had showed earlier.
The mining output in April declined 3.1 percent, manufacturing grew 0.1 percent and electricity grew 4.6 percent, the government statement said. Intermediate goods declined 1.4 percent and capital goods, by 16.3 percent, while basic goods grew 2.3 percent, consumer durables grew 5 percent and consumer non-durables, by 5.4 percent.
April’s near-zero growth in industrial output is likely to increase bets that the RBI could cut rates next week. However, the index is admittedly extremely volatile, so it’s highly likely the central bank is likely to focus on inflation data, out on 14 June, before making a decision.
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