Economy - Reports
Finance Ministry notes softening in manufacturing momentum, says rural demand continues to improve As on : 28-Oct-24  15:33

Finance Ministry stated in its latest monthly economic review that in the fourth year of economic recovery, post the contraction witnessed in FY21, several growth indicators show continuing momentum while some show signs of softening. On the supply side, the agriculture and services sectors have performed well. Though there has been some softening in the manufacturing momentum, RBI surveys on manufacturing indicate improved business expectations for the upcoming quarters. Above-normal monsoon, adequate reservoir levels, and sufficient input availability have bolstered kharif sowing, surpassing both last year's level and the five-year average. At the same time, heavy monsoon rains had a calming effect on mining and construction activity. They also led to a moderation in activity in the services sector somewhat in Q2 FY25, particularly in road transport-related services. Nevertheless, business sentiments remain sanguine. It noted that on the demand side, rural demand continues to improve, as reflected in increasing Fast Moving Consumer Goods (FMCG) volume sales and a rise in three-wheeler and tractor sales. However, urban demand appears to moderate due to softening consumer sentiments, limited footfall due to above-normal rainfall, and seasonal periods during which people tend to refrain from new purchases.

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