Retail inflation at 19-month low in January; December industrial growth subdued

Retail inflation in January is the lowest since June 2017 when it had touched 1.46 per cent. Consumer Food Price Index (CFPI) inflation stood at (-)2.17 per cent in January as against (-)2.65 per cent in December.

IIP, Industrial growth India, IIP 2018, IIP growth 2019, Industrial production growth 2018, India economy — On a month-on-month basis, however, the industrial growth as measured by the Index of Industrial Production (IIP), increased from 0.3 per cent in November.

Factory output growth slowed to 2.4 per cent in December from 7.3 per cent a year ago primarily due to slippage in output of manufacturing, mining and capital goods, data released by Central Statistics Office (CSO) Tuesday showed. Retail inflation continued to slide, easing to a 19-month low of 2.05 per cent in January, with food inflation continuing to remain in the negative zone, separate set of data released on Tuesday showed.

On a month-on-month basis, however, the industrial growth as measured by the Index of Industrial Production (IIP), increased from 0.3 per cent in November.

The industrial growth for November was revised downwards to 0.3 per cent from the provisional estimate of 0.5 per cent released last month. Cumulatively, for April-December 2018-19, industrial output grew at 4.6 per cent against 3.7 per cent in the same period of the previous financial year.

Manufacturing output, which accounts for 77.63 per cent of the index, grew at 2.7 per cent in December as against 8.7 per cent a year ago but was higher than contraction of 0.6 per cent in the previous month. Capital goods output, which is a proxy for investment demand, remained volatile growing 5.9 per cent in December as against 13.2 per cent in the corresponding period year ago, but was higher than contraction of 3.1 per cent a month ago.

Mining sector output contracted by 1 per cent in December as against 1.2 per cent growth in December 2017, the data showed.

Consumer durables output grew by 2.9 per cent as against a growth of 2.1 per cent in December 2017. Consumer non-durable goods growth was at 5.3 per cent in December compared with 16.8 per cent growth in the year-ago period.