Factory output shrinks 1.9% in November, retail inflation for December eases to 4.59%

After rising two consecutive months, manufacturing unit output faltered once more, slipping into the adverse in November resulting from contraction in manufacturing manufacturing and mining output, knowledge launched Tuesday by the National Statistical Office (NSO) confirmed.
Retail inflation for December, knowledge for which was additionally launched, provided some aid to policymakers, with value ranges easing to a 15-month low of 4.59 per cent on account of a dip in meals inflation. With this, the headline inflation charge has slipped again into the Reserve Bank of India’s goal band of 2-6 per cent for the primary time in 9 months.
The Index of Industrial Production (IIP) contracted 1.9 per cent in November after having recorded a progress of 0.5 per cent in September and three.6 per cent in October. IIP progress for October has now been revised to 4.2 per cent.
Factory output had grown by 2.1 per cent in November 2019. Cumulatively, manufacturing unit output for April-October final yr has contracted by 15.5 per cent, as in opposition to 0.3 per cent progress in the identical interval in 2019.
Among the sectors, manufacturing output — with a weight of 77.6 per cent within the IIP — contracted 1.7 per cent year-on-year in November after rising 4.1 per cent within the earlier month. Mining output contracted 7.4 per cent in November as in opposition to 1.9 per cent progress the earlier yr. Electricity technology was the one sector within the optimistic, recording a progress of three.5 per cent throughout November.

The use-based classification confirmed that 5 of the six sectors recorded a contraction of their output in November, with solely infrastructure items posting a progress of 0.7 per cent in the course of the month.
Capital items output, which is an indicator for funding demand within the financial system, slipped again into the crimson, declining by 7.1 per cent in November in comparison with a 3.5 per cent progress within the earlier month and eight.9 per cent contraction in the identical month a yr in the past.
Both shopper durables and shopper non-durables too contracted in November, signalling weakening demand.

The December inflation knowledge confirmed that retail meals costs, which make up practically half of the patron value index (CPI( inflation basket, recorded a progress of three.41 per cent within the month from a yr earlier, in opposition to 9.43 per cent in November.
Vegetable costs fell 10.41 per cent from a yr in the past in December, whereas cereals have been up solely 0.98 per cent, the info confirmed. Core inflation — which excludes meals and gas prices — was estimated at round 5.70 per cent for the month.
The financial system is projected to contract a report 7.7 per cent in 2020-21, a primary in over 4 a long time, with the NSO assuming a 0.6 per cent progress within the second half (October-March) of the present fiscal.