January IIP likely at 1% versus (-)0.6% in December: ET Now Poll

NEW DELHI: The Index of Industrial Production ( IIP) for the month of January likely expanded at 1% versus a contraction of (-) 0.6% in December, says an ET Now Poll. The consensus estimates of the poll range from (-) 0.8 per cent to 3.2%.

According to the poll, the production in mining sector of the economy may have continued to contract at (-) 4.1% versus (-) 4% in December. The manufacturing growth may have improved to 1.3% versus (-) 0.7%, but it would be impacted by a lower base.

The electricity sector's output growth will be better at 5.9% versus 5.2%, predicts the poll. While the capital goods output would have contracted, the consumer goods output would have continued to see a slowdown, says the poll.

The participants of the poll feel that the IIP is likely to improve very gradually. The Consumer Price Index (CPI) is likely to remain above 10%, while the Wholesale Price Index (WPI) may remain benign.

The Reserve Bank of India (RBI) is concerned about the high current account deficit (CAD) and inflationary expectations, said the poll participants. The poll predicts that the RBI may cut repo rate by at least 25 basis points in March.