Quote on IIP by Rahul Agrawal, Principal Economist, ICRA Ltd
Below the Quote on IIP by Rahul Agrawal, Principal Economist, ICRA Ltd
"The year-on-year (YoY) growth in the IIP expectedly eased to 6.7% in July 2026 from the upward revised 8.8% in June 2026, while printing slightly higher than ICRA’s estimate (+6.3%) for the month. The deceleration was broad-based and was partly driven by an adverse base.
Growth in manufacturing output eased to 7.3% in July 2026 from 9.5% in June 2026, while remaining quite strong, with 16 of the 23 sub-sectors witnessing a deterioration in their growth rates between these months. Mining output reverted to a contraction in July 2026 after witnessing a modest expansion in June 2026 aided by the sizeable rainfall deficit. The growth in utilities also slowed in July 2026 vis-à-vis June 2026, while remaining quite strong.
As many as 5 of the six use-based segments, barring consumer durables, witnessed a deterioration in their YoY performance in July 2026 compared to June 2026. While capital goods output expanded by double digits for the fourth consecutive month in July 2026, intermediate goods output also rose by a healthy 10.0% in the month. Besides, consumer durables output surged by 10.5% in the month, partly reflecting healthy growth in auto output.
Overall, IIP growth has remained quite strong during the first four months of FY2027, belying the expectations around the adverse impact on account of the West Asia tensions, although this was also partly supported by a favourable base."
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