The business outlook of the Indian manufacturing sector as inferred from movements in Business Expectation Index (BEI) shows improvement for the July-September quarter, according to the RBI’s industrial outlook survey.
The BEI reading for the July-September quarter is 114.7 as compared to previous quarter (111.1) and the corresponding quarter of previous year (112.7).
The improvement in BEI for the next quarter is mainly due to improved optimism on overall business situation, production, order books, capacity utilisation, imports, exports added with the reduced pessimism on cost of finance, cost of raw material and the profit margin.
For the July-September quarter, the proportion of respondents who expected increase in production and at the same time decline in employment (indicating jobless growth) turns out to be around 2 per cent. This has been consistent throughout past ten rounds of the survey.
In its consumer confidence survey, the RBI said the Current Situation Index (CSI) in June 2014 (at 100.4) remained at the threshold level as observed in March 2014 (99.9).
However, there has been significant improvement in Future Expectations Index (FEI) in June (122.9) over March (114.9) due to increase in the positive perceptions on all selected parameters except prices. Overall, the consumer confidence index reflects improvement in the positive perceptions during current round of survey.
The net responses on economic outlook witnessed consistent increase over the last three rounds, with the June 2014 reading coming in at 56.7 per cent against 29.9 per cent in September 2013.
The consumer confidence survey reflects successive improvement in income expectations over the last four quarters. More than 60 per cent of the respondents expected increase in income 12 months ahead.