India’s industrial production plunged to a year-over-year gain of 2.7% in November, according to the Times of India. That may not seem like bad news, but in October, industrial production rose by 11.29%, so this is well off the country’s growth pace.More alarming may be the actual slowdown in the manufacturing of consumer non-durables, which declined by 6% in November.
If food prices continue to rise, which expectations indicate they will, India’s Central Bank will be torn on whether or not it should raise key interest rates. If they do, food price spikes may slow, but so might a manufacturing sector under threat of slowing down. If they don’t, food prices may continue to spike, and manufacturing may still slow.