March factory output seen up 10% on month : Macquarie
India's industrial production may have risen 10 per cent on a monthly basis in
March as the effects of a recent spate of fiscal and monetary measures started
showing up, Macquarie Research said in a note.
Asia's third - biggest economy's export basket was not heavily dependent on
electronic and automotive shipments which has helped cushion the impact on the
sector, economist Rajeev Malik wrote in a recent note.
"Some industries (motor vehicles, cement and steel) are already showing signs of
increased activity, though India's structurally broad industrial base suggests that
industrial production will need a bit more time for the year - over - year growth rates to
be firmly in the black, and rising," it said.
Industrial output fell 1.2 percent in February from a year earlier, but January's
initially reported fall was revised to a rise of 0.4 percent, government data showed
on April 9. March numbers are due on May 12.
Macquarie said local banks have more room to cut their lending rates, which should
boost economic activity, though the central bank appeared to be nearing a monetary
easing cycle.
The Reserve Bank of India cut its key lending rate by 425 basis points since mid-
October 2008, as part of its measures to insulate the economy from a deepening
global financial crisis.
He expects the domestic economy to start recovering from mid - year, but sees
political uncertainty over the outcome of an ongoing federal election as a concern.
Source : The Economic Times
« Back
|