Positive IIP Data may strengthen the market sentiment:
The Quick Estimates of Index of Industrial Production (IIP) with base 1993-94 for the month of December 2009 have been released by the Central Statistical Organisation of the Ministry of Statistics and Programme Implementation. The General Index stands at 331.7, which is 16.8% higher as compared to the level in the month of December 2008. The cumulative growth for the period April-December 2009-10 stands at 8.6% over the corresponding period of the pervious year.
Calls for rolling back fiscal stimulus and further monetary policy action to prevent the economy from overheating got louder on
as industrial production in December 2009 rose the most in 15 years amid strong demand for cars, consumer goods and machinery, all aided by cheap money.
“With industrial production growing at a record pace, capital goods production surging, business confidence high and foreign direct investment rapidly returning, there are now a number of signs that private investment is set for strong growth. This should facilitate the RBI putting a greater focus on inflation. The current situation no longer necessitates a repo rate of 4.75 per cent and a cash reserve ratio of 5.75 per cent, which are low by historical standards and more appropriate for a slow recovery scenario,” said Nikhilesh Bhattacharyya, economist with Moody’s economy.com.
Source and elaborate news available at:
http://mospi.nic.in/mospi_iip.htm
http://www.livemint.com/2010/02/12143458/Industrial-output-encouraging.html
http://www.business-standard.com/india/news/record-industrial-growth-strengthens-case-for-stimulus-exit/385588/
http://economictimes.indiatimes.com/news/economy/indicators/Industry-rolls-at-168-in-Dec/articleshow/5566670.cms
