The Central Statistics Office will detail industrial production data for May at 1730 IST on Friday. (Representative Image)
New Delhi: India’s industrial growth is likely to have eased to 3.2 per cent in May from 3.4 per cent in the previous month, according to 17 economists polled by Cogencis.
India’s industrial growth in May 2018 was 3.8 per cent.
The Central Statistics Office will detail industrial production data for May at 1730 IST on Friday.
High-frequency indicators suggest mixed trends in industrial growth during May. Passenger vehicle sales contracted 20.6 per cent on year in May - the 10th such contraction in 11 months.
On the other hand, India's Purchasing Managers' Index for manufacturing rose to a three-month high of 52.7 in May from 51.8 in April.
A PMI reading above 50 indicates expansion in activity, and one below 50 points to contraction.
Merchandise export growth also increased to 3.9 per cent in May from 0.6 per cent in the previous month.
However, developments in India's eight core industries, which account for 40.3 per cent of the total weight in the Index of Industrial Production, were slightly more curious. Core sector growth for May came in at 5.1 per cent. While this would have been the highest in nearly a year, the figure for April was raised sharply to 6.3 per cent from the provisional estimate of 2.6 per cent. This was largely on account of a huge revision in steel output.
Steel output is now estimated to have increased 19 per cent in April as against the earlier estimate of 1.5 per cent.
This sharp revision in April core sector growth may have been reflected in the industrial growth rate of the month, which came in well above expectations at a six-month high of 3.4 per cent, up from 0.4 per cent in March.
A Cogencis poll had estimated IIP growth at 1 per cent in April, with the highest estimate being 1.6 per cent.
"Despite the positive surprise in the April IIP reading, the impact of election-related uncertainty poses downside risk to our estimates," said Standard Chartered Bank India Economist Kanika Pasricha.