Industrial growth may have fallen to 7.4% in September

India's industrial growth likely cooled to 7.4 percent in September on account of some weakening of momentum in activity. According to a Moneycontrol survey of 18 economists, industrial growth – as per the Index of Industrial Production (IIP) – likely fell in September for the first time in three months, with high-frequency data indicative of a slowdown.

In August, IIP growth had jumped to a 14-month high of 10.3 percent as activity improved sharply due to dry weather conditions. Industrial growth had come in at 3.3 percent in September 2022.

The Ministry of Statistics and Programme Implementation will release industrial production data for September later today at 5:30 pm.

"While the GST revenue grew by 10 percent year-on-year in September, all other high frequency indicators suggested some softening of growth momentum in the month of September," said Rupa Rege Nitsure, Group Chief Economist at L&T Finance.

Data released on October 31 showed India's core sector growth fell to a four-month low of 8.1 percent in September as all but one of the eight industries posted lower output growth numbers compared to August. With the eight core industries—coal, crude oil, natural gas, refinery products, fertilisers, steel, cement, and electricity—making up around 40 percent of the IIP, it is seen as a lead indicator of industrial growth data.

Other high-frequency data also suggest a weakening of activity levels, with the manufacturing Purchasing Managers' Index—an indicator of month-on-month change in activity levels—declining to a five-month low of 57.5 in September from 58.6 in August.