MAY INFLATION AT 4-MONTH HIGH; IIP GROWS 4.9% IN APR

Industrial output had risen 4.4% in March, a five-month low

Consumer price index-based inflation rose to a four-month high of 4.87 per cent in May, from 4.58 per cent the previous month, on rising food prices and a lower base. Food inflation rose to 3.1 per cent, from 2.8 per cent in April. Separately, industrial output expanded at 4.9 per cent in April, up from the 4.4 per cent growth rate seen in March due to a turnaround in capital goods production as well as an uptick in overall manufacturing growth. Growth in the Index of Industrial Production (IIP) had fallen to a five-month low of 4.6 per cent in March.

The country’s industrial output rose to 4.9 per cent in April, up from the 4.4 per cent growth seen in March due to a turnaround in capital goods production as well as an uptick in overall manufacturing growth.

Compared to this, growth in the Index of Industrial Production (IIP) had fallen to a five-month low of 4.6 per cent in March as manufacturing production growth halved from the month before and the capital goods segment saw contraction.

In April, growth in the major manufacturing segment — which constitutes the bulk of the index at 77.6 per cent — stood at 5.2 per cent, up from 4.6 per cent in March. Among the sub-sectors within manufacturing, seven recorded year-onyear contraction, down from 12 in March. Industries such as electronics, auto, pharma, food, metals, non-metallic products, etc. continued to do well. On the other hand, mining output rose by 5.1 per cent in April, in line with expectations as a sharp uptick in coal production had been seen during the month. But electricity generation registered a slower growth of 2.1 per cent, down from the more than double 5.9 per cent in March. April also saw growth among all use based classification groups, including the sensitive capital goods which returned to the growth charts with a 13 per cent rise.

The capital goods segment within the IIP connotes investment and had contracted by 5.7 per cent in March. A sharp contraction in gold jewellery output might be continuing to contribute to the subdued growth in the consumer durables sector, which rose to 4.3 per cent experts said. However, the largest sector — primary goods — continued to be plagued by low growth, rising 3 per cent after registering a 2.9 per cent rise in March.