Indian economy improves marginally in September but weakness persists, shows Mint tracker

Seven indicators were green, five red and four in amber in September. For each indicator, the value in each month is assigned a colour coding (red, amber and green) to denote where it lies relative to the five-year average (red denotes worse, amber denotes it is in line with the average range, and green denotes better).

There is an improvement from the previous month when eight indicators were red but a slight deterioration from six months ago when only four indicators were red and nine were green.

The weakness in the consumer segment persisted in September, with passenger vehicle sales still below their five-year average trend even as tractor sales and domestic air passenger traffic improved slightly. At the same time, the producer segment, which had been strong in the past few months, recorded signs of weakness in core sector growth and rail freight traffic. From the external sector, a wider trade balance continued to flash red.

Indicators that added strength to the economy were the composite Purchasing Managers’ Index (PMI), non-food credit, inflation, real rural wages, and labour force participation rate.

Mint macro tracker, which provides a monthly comprehensive report on the state of the economy, based on trends in 16 high-frequency indicators. The tracker has been running since October 2018.

Methodology note:While calculating the five-year average, data for some indicators for April-May 2020 and April-May 2021 have been removed to eliminate lockdown-induced skews in the trend. However, the five-year averages may still show high figures due to sustained base effect in several indicators in 2021 and 2022.

Monthly standings will get updated retrospectively as more data comes in.

For inflation, the red/green coding is reversed.