Industrial activity remained resilient in Jul-26, with IIP growth at 6.7% - moderating from an upwardly revised 8.8% in Jun-26, but comfortably ahead of market and our expectations
Download ReportQuantEco Research | Jul-26 IIP - Stays resilient, for now
Industrial activity remained resilient in Jul-26, with IIP growth at 6.7% - moderating from an upwardly revised 8.8% in Jun-26, but comfortably ahead of market and our expectations. The expansion was broad-based across manufacturing, electricity and utilities, and was reinforced by double-digit growth in capital, intermediate and consumer goods, even as mining slipped back into contraction and consumer non-durables remained a notable weak spot. The strong 6.3% FYTD growth, well above 4.0% in the corresponding period of FY26, alongside improving high-frequency indicators, suggests that industrial activity has withstood the recent global and geopolitical headwinds better than anticipated. However, the outlook remains cautiously optimistic, with deficient monsoon rainfall and rising El Niño risks posing downside risks to agricultural output and rural demand, while persistent geopolitical tensions could renew supply-chain and energy-price pressures. Against this backdrop, we expect industrial growth to moderate over the remainder of FY27, consistent with our FY27 GDP growth forecast of 6.4%.