Consumer durables output contracts in India, but hopes are high for festive season
The output of consumer durable goods in India contracted by 2.7 percent in July, even as industrial growth hit a five-month high of 5.7 percent. The contraction was driven by weak demand for clothes, furniture, and computers and electronic and optical products.
However, hopes are high that the festive season will boost demand for consumer durables. Economists at Motilal Oswal Financial Services expect industrial growth to rise to 8-10 percent in the next three months, “supported by a favourable base effect and the onset of the festive season”.
The festive season in India typically runs from September to December and is a major shopping period. It is also a time when many people buy new consumer durables.
However, there are some concerns about the outlook for the rural economy. Rural indicators are showing some signs of moderation, with slowdown in two-wheeler sales, softer diesel consumption growth and slowdown in tractor sales. The uneven monsoon performance has also resulted in demand for jobs under MGNREGA rising in August.
Overall, the outlook for consumer durables in India is mixed. While there are hopes that the festive season will boost demand, there are also concerns about the rural economy.
Here are some of the key takeaways from the article:
- The output of consumer durable goods in India contracted by 2.7 percent in July, even as industrial growth hit a five-month high of 5.7 percent.
- The contraction was driven by weak demand for clothes, furniture, and computers and electronic and optical products.
- However, hopes are high that the festive season will boost demand for consumer durables.
- Economists at Motilal Oswal Financial Services expect industrial growth to rise to 8-10 percent in the next three months, “supported by a favourable base effect and the onset of the festive season”.
- There are some concerns about the outlook for the rural economy, as rural indicators are showing some signs of moderation.
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