Tuesday, 23 October, 2018

Industrial production grows 7.1% in February

German industrial production Industrial production grows 7.1% in February
Nellie Chapman | 13 April, 2018, 13:56

This can be taken as a transitory change mainly on account of lower output in mining sector, said DK Srivastava, chief policy advisor at EY.

The factory output index grew 7.1 percent in December and 8.4 percent in November, last year.

Britain's goods trade deficit with the rest of the world narrowed to 10.203 billion pounds in February from 12.228 percent in January - the smallest gap since September and better than all forecasts in the Reuters poll that had pointed to a deficit of 11.95 billion pounds. Similarly, consumer non-durables's output edged-higher.

The weaker than expected February result was due to falling production in all categories - intermediate gods, capital goods and durable and non-durable consumer goods - except energy, the output of which surged 6.8 percent on the month after a 1.1 percent monthly decline in January. "In terms of industries, fifteen out of the twenty three industry groups in the manufacturing sector have shown positive growth during the month of February 2018 as compared to the corresponding month of the previous year", said the CSO report on the "Quick Estimates" of Index of Industrial Production (IIP) for February.

Eurozone industrial production decreased for the third straight month in February, Eurostat reported Thursday. Overall, inflation in the food basket was 2.81%, lower than 3.26% in February.

The subdued figures will interest Bank of England officials who are widely expected to raise interest rates next month for only the second time since the 2008 financial crisis.

Last week, the RBI brought down its January-March FY18 inflation projection to 4.5% from at 5.1%.

"The modest stimulus to growth from sterling's 2016 depreciation has begun to fade, while the global trade upswing has lost some momentum too", Samuel Tombs, an economist at consultancy Pantheon Macroeconomics, said.

The manufacturing sector, which constitutes over 77 percent of the index, grew at 8.7 percent in February as compared to the nearly flat growth of 0.7 percent in the same month a year ago.

Economic Affairs Secretary Subhash Chandra Garg tweeted: "Another very good IIP growth number came out today". Manufacturing grew by 8.7 per cent marking fourth month of growth over 8.5 per cent.

Howard Archer, chief economic adviser at the EY Item Club, said the ONS data "fuels suspicion that GDP growth likely slowed to 0.3 per cent quarter-on-quarter in the first quarter - especially as survey evidence points to economic activity suffering a marked hit in March from the severe weather".