Dec IIP growth slows down to 1.8% vs 5.9% in Nov

Industrial output in December has slowed down to 1.8% versus 5.9% in November. This is significantly below CNBC-TV18's estimates of 3.45%.

This slowdown was clearly indicated in the weak core sector numbers that was announced earlier. Core sector sectors like steel, cement, fertilisers, crude and refinery grew by only 3.1% in December compared to well over 6% in November. Core sector comprises 38% of the IIP basket.

However, IIP is not a data that Reserve Bank of India looks very closely, especially the provisional numbers because they tend to be very volatile. Definitely for RBI policymaking, which is expected to ease in March and April, the WPI numbers  expected to be announced on February 14 will be much more important.

Here is a snapshot:

• Capital goods growth at -16.5% vs -4.6% (MoM)
• Mining goods growth at -3.7% vs -4.4% (MoM
• manufacturing goods growth at 1.8% vs 6.6% (MoM)
• Consumer durables growth at 5.3% vs 11.2% (MoM)
• Non-durable consumer goods growth at 13.4% vs 14.8% (MoM)
• Consumer goods growth at 10% VS 13.1% (MoM)
• Electricity growth at 9.1% vs 14.6% (MoM)
• Basic goods growth at 4% vs 6.3% (MoM)
• Intermediate goods growth -2.8% at vs 0.2% (MoM)