Capacity Utilisation Above Long-Run Average; Inflation Expectations Decline: RBI Surveys
At the aggregate level, capacity utilisation rose to 75.3% in the fourth quarter of FY22 from 72.4% in the previous three months.
Capacity utilisation in the manufacturing sector has improved for the third successive quarter, indicating a recovery in demand, according to a Reserve Bank of India survey.
At the aggregate level, capacity utilisation rose to 75.3% in the fourth quarter of FY22 from 72.4% in the previous three months, the survey said. Manufacturing companies received more new orders during Q4 compared with the previous quarter as well as in the corresponding year-ago period.
Capacity utilisation in the manufacturing sector is now above its long-run average, signaling the need for fresh investment activity in additional capacity creation, Shaktikanta Das, governor at the nation’s central bank, said in a statement on Friday.
Consumer Confidence Picks Up
Consumer confidence continued to recover in successive rounds of the survey after a historic low recorded in July 2021. Still, it remained in the pessimistic zone.
The current situation index rose to 77.3 in July 2022 from 75.9 points in May on account of an improved perception on employment, household income and spending, another RBI survey said. The future expectations index rose to 113.3 from 113 during the period.
Inflation Expectations Ease
Households’ median inflation perception for the current period moderated 80 basis points to 9.3% in the latest round of an RBI survey titled ‘Inflation Expectations Survey of Households for inflation’.
The three months and one-year ahead median inflation expectations also declined 50 basis points to 10.3% and 60 basis points to 10.5%, respectively, from the May 2022 round of survey.
