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World Economy

OPEC Monthly Oil Market Report – November 2017

21

India’s

CPI inflation

was stable at 3.28% y-o-y in September, unchanged from the previous month's five-

month high and below market expectations of 3.6%. India’s WPI decreased to 2.60% y-o-y, following a

3.24% increase in the previous month. The figure came in below market estimates of a 3.41% gain, mainly

due to a slowdown in cost of food and fuel.

Graph 3 - 17: India’s GDP growth

Graph 3 - 18: India’s inflation

India's

trade deficit

narrowed to $8.98 billion in September, from $9.07 billion in the same month of the

previous year.

Exports

advanced 25.7% y-o-y to $28.61 billion.

Imports

also grew 18.1% y-o-y to

$37.60 billion.

Graph 3 - 19: India’s trade balance

Graph 3 - 20: India’s gold imports

Growth in India’s manufacturing sector lost momentum in October. Output rose only fractionally and new

orders stagnated over the month. In response to subdued demand conditions, both purchasing activity and

pre-production inventories decreased. The Nikkei India

Manufacturing PMI

fell from 51.2 a month earlier to

50.3 in October. Improvements in consumer goods were offset by declines in investment and intermediate

goods. India’s manufacturing companies struggled somewhat as the recent recovery enjoyed by the sector

lost impetus in October. Inflows of new orders stagnated as the negative effects arising from the

implementation of the GST continued to dampen demand levels. Furthermore, overseas demand for Indian

goods dropped to the lowest levels seen since September 2013.

On the bright side, the

labour market

continued to improve, with manufacturers further increasing staffing

levels, and at a pace similar to September’s 59-month high. However, business confidence eased to the

weakest since February as some firms expressed concerns over negative GST effects, while others forecast

positive effects of the GST materialising over the next 12 months.

6.1 5.7

7.1

7.5

7.9

4

5

6

7

8

9

10

1Q 14

2Q 14

3Q 14

4Q 14

1Q 15

2Q 15

3Q 15

4Q 15

1Q 16

2Q 16

3Q 16

4Q 16

1Q 17

2Q 17

Sources: National Informatics Centre (NIC) and

Haver Analytics.

% change y-o-y

3.28

2.60

0

1

2

3

4

5

6

Sep 16

Oct 16

Nov 16

Dec 16

Jan 17

Feb 17

Mar 17

Apr 17

May 17

Jun 17

Jul 17

Aug 17

Sep 17

%

Consumer price index (CPI)

Wholesale price index (WPI)

Sources: Ministry of Commerce and Industry, Reserve Bank of

India and Haver Analytics.

28.61

-37.60

-8.98

-50

-40

-30

-20

-10

0

10

20

30

Sep 16

Oct 16

Nov 16

Dec 16

Jan 17

Feb 17

Mar 17

Apr 17

May 17

Jun 17

Jul 17

Aug 17

Sep 17

Exports

Imports

Trade balance

US$ bn

Sources: Ministry of Commerce and Industry and

Haver Analytics.

-100

-50

0

50

100

150

200

250

300

350

-2

0

2

4

6

8

Sep 16

Oct 16

Nov 16

Dec 16

Jan 17

Feb 17

Mar 17

Apr 17

May 17

Jun 17

Jul 17

Aug 17

Sep 17

US$ bn

Gold imports (LHS)

Change y-o-y (RHS)

Sources: Ministry of Commerce and Industry and

Haver Analytics.

Percentage