Recovery continues however shedding tempo

The contraction of 1.6 per cent within the manufacturing facility output for January comes manner beneath expectations, suggesting there are a number of pockets of frailty throughout the broader restoration. The slowdown was broad-based — each capital and shopper items fared poorly. The dangerous information is that labour-intensive sectors stay sluggish.
While the providers sector is selecting up, the February composite PMI was up at 57.3 from 55.8 in January — the lack of momentum elsewhere is a priority at a time when there may be recent surge of infections particularly in key states like Maharashtra.
A brand new spherical of lockdowns might gradual the revival. Retail two-wheeler gross sales proceed to be uninteresting; between April 2020 and February, they’ve gone up in only one month presumably as a result of automobiles have change into costly and unaffordable for some sections. While GST collections for January surpassed expectations, the era of e-way payments has stayed roughly flat since October 2020.

Loan development, whereas ticking up, stays low at about 6 per cent; importantly company bond issuances have come off sharply in January and February to ranges of Rs 45,000 crore per thirty days in contrast with the common for the March-December 2020 interval. Pertinently, state-owned entities borrowing appear to be doing the majority of the borrowing.
The efficiency of the core sector, as an illustration, continued to enhance in January however at a slower tempo: the rise was 0.1 per cent month-on-month seasonally adjusted versus 2.2 per cent within the earlier months.

CMIE knowledge present that at 6.9 per cent, unemployment in February was decrease than the common of seven.3 per cent since July 2020; nonetheless, each the labour pressure participation charge and the employment charge stay considerably decrease than their ranges earlier than the lockdown and it might be some time earlier than these transfer as much as pre-pandemic ranges. fe