The Index of Industrial Production (IIP) showed a de-growth of 0.1% in November 2012 as against market expectations of 0.64% de-growth. IIP for the October has been revised upward to 8.3% from 8.2% growth.
Markets were largely factoring in a flat to marginally negative IIP print for November 2012 mainly owing to drawing down of inventory which was likely build-up in October 2012 on the pre-festival season demand. Even the slight 1% yoy growth in the April - November 2012 period can be mainly attributed to healthy growth in October 2012, said Bhupali Gursale, economist at Angel Broking.
''We believe that the Reserve Bank's stance has increasingly shifted towards supporting growth rather than focusing solely on inflation management and with recent moderation in core inflation, we expect the RBI to ease the repo rate by 25 bps in its January policy decision,'' Gursale said.
"Going forward owing to the high base for the remaining part of the fiscal, we largely expect the IIP print for FY2013 to remain flat to negative," she added.
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