IIP beats expectations at 2.4%; diminishes prospects of a rate cut

The index for industrial production (IIP) data has come in better than expected at 2.4%, as against expectations of around 1%. The better than expected figure now diminishes the prospects of a rate cut.

Index of Industrial production stood at 2.4% higher than higher as compared to the level in the month of May 2011.

The IIP for the Mining, Manufacturing and Electricity sectors for the month of May 2012 stood at 129.7, 178.9 and 162.3 respectively, with the corresponding growth rates of (-)0.9%,2.5% and 5.9% as compared to May 2011.

Capital goods and mining sectors continue to decline in output of 7.7% and 0.9%, respectively in May year-on-year basis.

The consumer durables and consumer non-durables have recorded growth of 9.3% and 0.1% respectively, with the overall growth in consumer goods being 4.3%.

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