India: Industrial production continues to slide
August 9, 2012
In June, industrial production contracted 1.8% over the same month last year, according to the so-called quick estimate for the index of industrial production (IIP). The reading contrasted both the revised 2.5% increase recorded in May (previously reported: +2.4% year-on-year) as well as market expectations of a 0.4% rise. The monthly contraction primarily reflected a decline in the manufacturing sector, which accounts for over three quarters of total industrial output. On a use-based classification, the monthly fall was mainly driven by plummeting growth in capital goods production. As a result of the monthly drop, the trend continues to point downwards, with annual average growth in industrial production falling from 2.2% in May to 1.3%.