See Dec IIP at 3.45% vs 5.9% in Nov: CNBC-TV 18 poll

The CSO will announce the December industrial output numbers today. A CNBC-TV 18 poll sees it at 3.45% versus 5.9% in November, reports Latha Venkatesh.

December is expected to have been a slower month than November. The November number came in fairly good at 5.9% compared to a contraction of 4.7% in October. But there is enough evidence to indicate that December will not be as good as November, though there is no contraction.

One, car sales and two-wheeler sales had slowed in December. In fact car sales were 7% lower in December compared to their November levels.

Second, core sector numbers, sectors like steel, cement, fertilisers, crude, refinery, comes in earlier than the IIP. That showed that core sector industries grew by only 3.1% in December compared to well over 6% in November. Core sector comprises 38% of the IIP basket.

The Purchasing Manager's Index came sharply higher in December compared to November. But barring this, other data indicate that December may have been a slower month.

All said and done, IIP is not a data that Reserve Bank of India looks very closely, especially the provisional numbers because they tend to be very volatile. Definitely for RBI policymaking, which is expected to ease in March and April as well, the WPI numbers that come out on Tuesday, February 14, will be much more important.

In any case, some components of the IIP numbers will be very important. Capital goods, which has been contracting for many months, they contracted in November as well, will be very closely watched.