BLBG: India to Announce September Industrial Output Data: Week Ahead
By Thomas Kutty Abraham
Nov. 10 (Bloomberg) -- India's industrial production growth probably held near the weakest pace on record in September as spiraling prices and higher borrowing costs damped consumer spending and companies cut output.
The Central Statistical Organisation will release the report at midday in New Delhi on Nov. 12. Output at factories, utilities and mines rose 1.3 percent in August from a year earlier, the slowest pace on record.
The Reserve Bank of India unexpectedly cut its benchmark rate on Nov. 1 for the second time in two weeks, joining policymakers across Asia in lowering borrowing costs to stimulate waning demand and shield their economies from the global financial crisis.
``The moderating trend in output will remain there,'' said N.R. Bhanumurthy, an economist at the Institute for Economic Growth in New Delhi. ``The Reserve Bank may reduce interest rates further as declining fuel and food costs ease price pressures and to revive dwindling demand.''
The central bank lowered its repurchase rate to 7.5 percent from 8 percent, reduced the amount of deposits that lenders need to set aside as reserves to 5.5 percent from 6.5 percent, and cut the amount of money lenders are required to keep in government bonds to 24 percent from 25 percent.
The rupee had its biggest weekly gain in more than 12 years in the five days ended Nov. 7 on optimism falling borrowing costs worldwide will boost investor demand for emerging-market assets. The currency extended last week's gains as central banks in the U.K., Europe, Australia, South Korea and India added to last month's interest-rate cuts, helping global stocks rebound.
Rupee Climbs
The rupee climbed 3.8 percent last week to 47.66 a dollar in Mumbai, according to data compiled by Bloomberg. That is the most in such a period since March 1996, making it the best performer among Asia's 10 most-active currencies outside Japan.
Benchmark 10-year bonds had their worst week in more than a month after the central bank said it may lower the limit on debt some banks need to hold to free up cash.
The yield on the benchmark 8.24 percent note due April 2018 rose 19 basis points last week to 7.69 percent in Mumbai, according to the central bank's trading system. The price fell 1.33 rupees per 100-rupee face amount, to 103.6375. A basis point is 0.01 percentage point.
The Bombay Stock Exchange's Sensitive Index, or Sensex, posted its second weekly gain. The gauge advanced 1.8 percent to 9,964.29.
Overseas funds sold a net 4.14 billion rupees ($102.6 million) of Indian equities on Nov. 6, increasing outflows from stocks this year to $12.5 billion, according to the country's market regulator. Investors bought 15.2 billion rupees of stocks and sold 19.4 billion rupees on Nov. 6, the Securities & Exchange Board of India said on its Web site. Overseas investors have bought bonds worth $1.47 billion till Nov. 6.
Event Date
Reliance Industries Ltd.-NTPC Ltd. case hearing 11
Industrial production data 12
Inflation data 13
India energy summit 14-15
India economic summit 16-18
To contact the reporter on this story: Thomas Kutty Abraham in Mumbai at tabraham4@bloomberg.net.