New Delhi: India’s factory output contracted 1.1% in August as against a growth of 4.2% reported a month ago, thus signaling a deepening economic downturn. This may pave way for further monetary easing by the central bank for the sixth consecutive time in December. Data released by the Ministry of Statistics showed manufacturing and electricity contracted 1.2% and 0.9% respectively while mining output remained almost flat growing at 0.1%. Data released earlier this month by the industry department showed India’s eight infrastructure sectors constituting about 40% of IIP contracted for the first time in more than four years in August by 0.5%. Realizing that the economic downturn is sharper than it earlier anticipated, it pared down its full year growth forecast to 6.1% in 2019-20 from 6.9% projected earlier.

Source: Mint October 11, 2019 12:11 UTC