India: Industrial production picks up pace in June
August 12, 2016
Industrial production accelerated in June, recording the largest expansion since October. Industrial output rose 2.1% compared to the same month last year, which followed May’s revised 1.1% increase (previously reported: +1.2% year-on-year). The print overshot market analysts’ expectations, who had expected a milder acceleration to 1.5% growth.
June’s upturn was driven by a broad-based improvement in the index. Manufacturing growth rose from 0.6% in May to 1.0% in June, an eight-month high. In addition, mining output accelerated from a 1.4% increase to a notable 4.7% expansion and electricity output grew 8.3% (May: +4.7% yoy).
On a use-based classification, the production of basic, intermediate and consumer goods all gained steam. However, the contraction in capital goods production intensified.
Despite the result, the trend continued to point downward. Annual average growth in industrial production eased from May’s 2.0% to 1.9%, which represented an 18-month low.