India Nov industrial output slides after Oct surge
MUMBAI, India (AP) — India's industrial output contracted in November, after a surprise October surge, government data showed Friday, possibly strengthening the central bank's resolve to trim interest rates when it meets later this month.
Industrial production fell 0.1 percent in November from a year ago, hurt by a 5.5 percent plunge in mining output and a sharp slowdown in manufacturing. That reversed October's revised 8.3 percent rise in industrial output, government data showed Friday.
The data are distorted by India's main holiday season during October and November. Last year, the festival of Diwali fell in October. This year, it was in November, skewing year over year comparisons.
Taken together, the data show a small acceleration in industrial output over the past few months, mostly in the consumer sector, said Glen Levine, a senior economist at Moody's Analytics.
"The corporate sector may have improved a little as well, but remains quite weak and until we see a sustained pick up in business sentiment and investment, the Indian economy will continue to operate below capacity," he said.
India is on track to report its slowest economic growth in a decade for the fiscal year ending March.
The central bank has been under intense pressure to cut interest rates and is widely expected to deliver a rate cut in January.