Indian economy’s pace of normalisation has moderated at the end of January, says Nomura


The pace of normalisation of business activity in India moderated compared to the start of the year as the Nomura India Business Resumption Index (NIBRI) marginally dipped to 92.7 for the week ended January 24 from a 94.4 at the start of the month.

Budget BannerThe index of high frequency indicators including mobility indices, also recorded a fall from the previous week’s reading of 93.2, Nomura said in a note on Tuesday, driven by a sharp drop in Google’s mobility indices.

Despite this, NIBRI’s average trend was higher in January at 93.4 as compared to 91.7 in December and 86.3 during the previous month, suggesting that the economy remained on the path of normalisation, said Nomura economists Sonal Varma and Aurodeep Nandi, in the note.


In terms of mobility, Google’s workplace and retail and recreation mobility indices dipped to half of the previous week’s levels even as the Apple driving index improved, the note said.

Power demand saw a healthy 5.1% growth coming on the back of 1.7% improvement in the previous week. Similarly, the labour participation rate inched up to 41.3% from 39.4% earlier.

While the economy would continue to see positive growth, Nomura expected some paring in the pace of sequential improvements, projecting 2% quarter-on-quarter growth for the final quarter of this fiscal compared to 10% sequential growth it saw in the previous quarter.

Going forward, “Progress on vaccinations, growth support in the Budget and a global recovery remain key near-term growth determinants,” Nomura said.

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