SBI’s Composite Index hits 6-month high in March

Here’s an indication that the economy is on the mend. State Bank of India’s Composite Index for March inched up to a six-month high of 54.6. In February, the Composite Index (CI) was at 53.5. The CI for both February and March indicates moderate growth in the economy.

A CI of 52-55 and 55 and above indicates moderate growth and high growth, respectively, in the economy. The index above 50 implies growth over the previous comparable period and less than 50 suggests a contraction.

SBI’s Monthly Index showed a robust growth of 58.5 in March, the highest in the past 48 months. In February 2015, the Monthly Index was at 47.6, implying that the economy was in a ‘low decline’ phase.

SBI has attributed the robust recovery in the month-on-month index to seasonal factors, as March sequential momentum is always higher. India’s largest bank said revival in automobile sales, capital goods and basic goods production and possible upturn in the credit offtake to micro and small corporate segments and real estate highlight possible sustainable recovery in the economic activity in coming months.

Manufacturing activity is becoming robust with growth for the third consecutive month (since November 2014). Index of Industrial Production has averaged 3.2 per cent growth since November 2014.

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