With reform momentum apparently stalling, a swift depreciation in the rupee and subdued export demand weighing heavily, Indian business confidence hit a one-and-a-half year low in September, according to a new survey.
The MNI India Business Sentiment Indicator, a gauge of sentiment among Bombay Stock Exchange-listed (BSE) companies, fell to 61.4 in September from 62.3 in August. It was the third consecutive month of decline. A reading above 50 shows expansion, whereas a reading below 50 indicates contraction.
“Growth in some of India’s largest companies is being held back by the weakness in global demand and the negative impact of the rupee on operations,” said Philip Uglow, chief economist of MNI Indicators, a market intelligence group owned by Deutsche Borse. Deutsche Borse provides data services to the BSE.
“Overall business confidence is back at the lows seen in 2014 while orders appear to have resumed their steady downward course.”