India Factory Output Grows

India’s industrial output growth momentum continued as it grew at 7.1% in December, aided by robust manufacturing output, data released by the central statistics office showed, Moneycontrol reported. Factory output had hit a 25-month high of 8.4% in November, last year, as compared with a modest growth of 2.4% during December, 2016. Factory output measured by the index of industrial production is the closest approximation for measuring economic activity in the country’s business landscape. Cumulative IIP growth for the period April-December 2017 over the corresponding period of the previous year stands at 3.7%. The jump in IIP in November and December was primarily due to base effect—a statistical phenomenon that makes even tiny changes look large. The effect was primarily contributed to Prime Minister Narendra Modi’s massive currency recall exercise on November 8, 2016 that pulled out 86% of the currency in circulation. Manufacturing sector, which accounts for more than three-fourths of the entire index soared 8.4% in December 2017, compared with a 10.2% jump in November 2017 and a tepid growth of 0.6% a year ago, government data showed. IIP growth nevertheless remained healthy at 7.1%