Core sector growth rebounded to a five-month high in August while manufacturing activity expanded for the second month running in September, providing some cheer for an economy that saw growth touch a three-year low in the June quarter. The core sector, comprising eight infrastructure segments, saw a 4.9% rise in output in August compared with 2.6% in July, data released by government showed. To be sure, the growth was driven largely by a sharp rise in coal and electricity output and wasn’t evenly spread. Crude oil, cement and fertilizer declined. The core sector grew 3.1% in August last year. Increases in both output and new orders helped the manufacturing sector remain in the expansion zone with the Purchasing Managers’ Index (PMI) coming in at 51.2 in September, the same as August. Despite August being a monsoon month, coal production was at a 33-month high of 15.3%, aided by a favourable base effect and less rain in the coal-producing states of central India. Electricity output rose to a 16-month high of 10.3% in August. However, crude oil, fertilizer and cement production declined 1.6%, 0.7% and 1.3%, respectively, in August. Steel posted 3% growth.

(Economic Times)