India's factory output grows sharply at 4.3% in August

Ann Santiago
October 13, 2017

Analysts polled by Reuters had expected September's CPI inflation rate would edge up to 3.60 per cent from August's downwardly revised 3.28 per cent.

Mumbai: Consumer inflation edged lower to 3.28 per cent for the month of September, driven by housing and fuel prices.

Factory output recorded a muted 0.9 per cent growth in July 2017, which was the first month after GST implementation.

The YoY CPI dropped to 3.44 per cent in urban areas and 3.15 per cent in rural areas in September as compared to 3.64 per cent and 5.04 per cent respectively in the corresponding period previous year.

The International Monetary Fund (IMF) on Tuesday also cut its growth forecast for the Indian economy by half a percentage point to 6.7% for 2017-18, blaming the lingering disruptions caused by demonetisation of high value currencies past year and the roll out of the GST. The current inflation rate remains below the Reserve Bank's 4 per cent target.

Retail inflation has been steadily rising since June, when it eased to 1.46 per cent - its slowest pace since India started releasing such figures in January 2012, based on combined data for rural and urban consumers.


The Index of Industrial Production (IIP) had registered a tepid growth of 1.2 per cent in July this year.

Capital goods output, which is reflective of the private sector investment scenario, rose 5.4 percent in August compared with (-) 0.1 percent contraction in July.

Electricity production increased 8.3 percent in August as compared with 2.1 percent a year ago.

During April 2017-August 2017 period IIP grew at 2.2%, down from 5.9% in the same period in 2016-17.

As food prices remained steady, the country's retail inflation also remained flat at 3.28% in September.

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