Macro Watch
Update on Data Trends | November 2022
Macro Heat Map
Indian economy stays resilient amidst global pressures
- Retail inflation, as measured by the Consumer Price Index, eased to 6.8% on-year in October. Given the rising commodity prices during the same period last year, CPI is likely to moderate in the coming months.
- Revival in business sentiment, as indicated by Purchasing Managers’ Index (PMI-Services and Manufacturing), reflected in the robust offtake in bank credit, which grew 17% on-year in September’22. Credit disbursed to services and industrial sectors too, witnessed a double-digit growth reaching 20% and 13% respectively. Banks’ exposure towards corporate credit is likely to stay elevated as corporates move away from bond markets due to rising yields.
- Industrial output, as measured by the Index of Industrial Production (IIP), witnessed a growth of 3.1% in September, led by power sector, which grew 11.6% .
Manufacturing output exceeds pre-pandemic levels
- Manufacturing activity in September grew 6.6% when compared to pre-pandemic levels.
- Owing to a strong festive season demand, the automobile sector recorded a double-digit growth reaching 24% in September.
- High inflation is impacting the demand for consumer durables, which witnessed an overall de-growth of 4.5%.
Uptick in rating optimism suggests sustained recovery
A rising rating optimism for October suggests a sustained recovery of manufacturing output. However, even as manufacturing activity slowly treads on a path to recovery, inflationary risks are likely to keep corporate margins under pressure.
Course Ahead
Easing of global inflation as well as Wholesale Price Index (WPI) are comforting factors. However, inflation staying 80 basis points above the central bank’s tolerance limit suggests another rate hike of 35-50 basis points in the upcoming MPC meeting in December.
TruQuest is knowledge series launched by TruBoard Partners providing succinct updates and views on:
- Liquidity outlook
- India’s macro economic view
- Trends within the infrastructure, Real Estate and Renewable Energy sectors
- Impact analysis of new regulations and policies on lending and capital flow
Team:
Nandkumar Surti, Cofounder
Ria Rattanpal, Research Associate
Komal Chavan, Marketing Associate
Team:
Nandkumar Surti, Cofounder
Ria Rattanpal, Research Associate
Komal Chavan, Marketing Associate
Disclaimer
The data and analysis covered in this report of TruQuest has been compiled by TruBoard Pvt Ltd and its associates (TruBoard) based upon information available to the public and sources believed to be reliable. Though utmost care has been taken to ensure its accuracy, no representation or warranty, express or implied is made that it is accurate or complete. TruBoard has reviewed the data, so far as it includes current or historical information which is believed to be reliable, although its accuracy and completeness cannot be guaranteed. Information in certain instances consists of compilations and/or estimates representing TruBoard’s opinion based on statistical procedures, as TruBoard deems appropriate. Sources of information are not always under the control of TruBoard. TruBoard accepts no liability and will not be liable for any loss of damage arising directly or indirectly (including special, incidental, consequential, punitive or exemplary) from use of this data, howsoever arising, and including any loss, damage or expense arising from, but not limited to any defect, error, imperfection, fault, mistake or inaccuracy with this document, its content.