World Bulletin / News Desk
India's industrial output contracted for the third time in four months inJune, increasing pressure on new Finance Minister Palaniappan Chidambaram to move quickly to pullAsia's third-largest economy from its worst slowdown in almost a decade.
The contraction provided further ammunition to the slew of private economists who downgraded their growth outlook for India this week, citing a worsening drought and political hurdles to economic reform.
"The data bodes ill for Q2 (FY Q1) GDP growth which may well remain below 6 percent year-on-year. It highlights continued softness of the Indian economy amid contracting exports and weaker domestic demand," said Dariusz Kowalczyk, an economist with Credit Agricole CIB in Hong Kong.
Industrial output in June shrank 1.8 percent, driven down by a deep dip in manufacturing, the data released on Thursday showed. The number was lower than a forecast of 1.0 percent growth in a Reuters poll and sharply lower than 9.5 percent growth a year earlier.
Economic growth faltered to a nine-year low of 5.3 percent in the quarter ending in March, with corporate investors deterred by high interest rates and a policy gridlock. Several economists this week cut their full-year growth forecast for India to around 5.5 percent -- which would be the slowest rate in 10 years.
India's industrial output data is volatile but is still considered a barometer of GDP growth. May's figure was revised to 2.5 percent from 2.4 percent, the data showed.
Manufacturing, which constitutes about 76 percent of industrial production, shrank an annual 3.2 percent from a year earlier, the federal statistics office said.
Markets dipped after the unexpected contraction. The rupee was last trading at 55.15 per dollar compared to around 55.08 before the data, though that was still stronger than its 55.42/43 close against the dollar on Wednesday.
The benchmark 10-year bond yield fell about 2 basis points to 8.11 percent from levels before the data.
Capital goods, a key investment indicator that has shown growth only once in the past 10 months, slumped 27.9 percent in June, data on Thursday showed.
The reflection of Syriza’s increase in votes throughout Greece is remarkable however what remains is the left wing's sucess against neo-liberal policies?
Fed repeats to be "patient" in deciding when to raise rates.
The plan help bring down current EU-wide employment of some 10 percent, the ILO said.
A stand-off between the United States and Japan over access to farm and auto markets has been holding up negotiations over the 12-nation trade pact, known as the Trans-Pacific Partnership (TPP).
Hollande calls on companies and investors to join in 'fighting climate change'.
Currency market players 'would see opportunities' in central bank's measures, billionaire currency investor warns.
Schauble denies reports Berlin has prepared for the possibility Greece may leave the euro if Syriza party wins Greek elections.
The incident at the bank weakened the Libyan dinar against the dollar on the parallel market.
Support for Russian companies, small businesses and social spending make up bulk of new measures aimed at supporting ailing Russian economy.
In just seven days the central bank spent nearly $7bn of its reserves.
The site is on 233 hectares of reclaimed land in the capital, Colombo. Under the proposed deal, 108 hectares would be given to the Chinese firm, including 20 hectares on an outright basis and the rest on a 99-year lease.
The ECB said it would purchase sovereign debt from this March until the end of September 2016, despite opposition from Germany's Bundesbank
President pushes currency, fuel reforms for ailing Venezuela
All eyes on size, details of expected stimulus programme, Greek banks bounce as emergency line granted.