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Bloomberg
A private gauge indicates that India’s manufacturing output slid to the lowest since the financial crisis as the roll out of a new nationwide sales tax disrupted supply chains across the country.
The Nikkei India Manufacturing Purchasing Managers’ Index was at 47.9 in July. A number below 50 indicates contraction.
The outlook for the year ahead remains positive with companies expecting more clarity about the GST to boost growth, Pollyanna De Lima, principal economist at IHS Markit, wrote in a report. “The weakening trend for demand, relatively muted cost inflationary pressures and discounted factory gate charges provide powerful tools for monetary policy easing, which has the potential to revive economic growth,” De Lima wrote. The data comes a day before the central bank’s interest rate decision, seen as Governor Urjit Patel’s last chance through 2018 to stimulate the economy.