A report by global investment bank, Morgan Stanley has said that recent high frequency growth indicators suggest that the growth momentum has gathered pace in December. Commenting on the issue, a Morgan Stanley Official told the media, “Purchase Managers' Indices (PMIs), sales of commercial vehicles, steel and cement demand growth have accelerated on a sequential basis, suggesting a further uptick in economic activity.
We expect the trade data to also mirror this strength - with both exports and imports growth holding up well." “December's inflation data would likely rise further, though partly due to an unfavourable base of comparison.
In particular, the trend in core-core inflation (inflation ex food, fuel and housing) will be key to watch to assess the trend in underlying inflation dynamics,” he added. On the production side, the investment bank expects November's industrial production to have improved as was validated by the improvement in most high frequency growth indicators in the month.