Commenting on the January numbers, Dr. Surjit Bhalla, Senior Advisor, BluFin said, "One important reason for the shallow recovery underlined by the Blufin BCI is the fact that in this cycle, unlike others, monetary policy has been influential in preventing any genuine growth."
Based on recent BCI trends, the Index of Industrial Production is expected to grow by no more than 2% in the remaining months of the current fiscal year. In January, 34 out of the 42 economic indicators covered by BluFin to construct the BCI indicated towards an improvement. Foreign trade related indicators and real economy variables like aluminum production and revenues earned from railway freight contributed to the latest year-on-year growth in the BCI. Interestingly, after remaining subdued for a long time, there are some early signals that aspects of consumer demand are gradually reviving. Indicators like tourism and domestic air travel has also shown improvement compared to same time last year. However, the key indicators that pulled the growth rate down in January included iron production, electricity and rubber prices.