Weekly economic indicators: Revival in activity shows signs of slackening

Many key indicators trended lower last week after a strong showing earlier this month

A number of high-frequency weekly economic indicators seemed to have taken a pause last week after some strong gains earlier this month.

Power generation, goods carried by trains and urban emission numbers were weaker than in the recent past. Business Standard tracks these and other numbers, including traffic congestion and location data as a way of getting a more current picture of the economy ahead of macroeconomic numbers, which are often released with a lag. The location data comes after a gap and is as of October 13. Railway numbers are as of Saturday October 17. All other numbers are as of Sunday.

Electricity generation had shown double-digit growth over 2019 in much of October. This slipped to a single digit in the latest week, at 6.9 per cent, showed the rolling average for the seven days that ended Sunday. It had been 15.6 per cent higher in the previous week (see chart 1).

 

Indian Railways carried less goods last week. Freight quantity carried, which had last week been 21.3 per cent higher than in the comparable period of 2019, dropped to 9.3 per cent in the latest week. Freight earnings growth dropped from 12.6 per cent to 3.1 per cent. Both quantity and earnings, however, remain in the positive territory (see chart 2).

 

Business Standard looks at nitrogen dioxide emissions to track economic activity. The emissions come from industrial sources and vehicles. The level of nitrogen dioxide in Delhi last week was 15-20 per cent higher than in the same week in 2019. This dropped to a lower range for much of the week. Vehicles play a major role in Delhi’s emissions. The Central Pollution Control Board had found a 56 per cent decline in nitrogen dioxide levels during the lockdown in the city. Mumbai’s emissions, based on Bandra locality readings, were around 96 per cent lower than in 2019 (see chart 3 and 4).  

 

More people do seem to be populating offices now. Workplace visits were around 78 per cent of normal last week, showed anonymised location data from search engine Google's mobility reports (see chart 5).

 

Accordingly, traffic congestion appeared to have increased, showed data from global location technology firm TomTom International. Mumbai’s congestion numbers last week were at 77 per cent of the 2019 level. In New Delhi, it was at 76 per cent. This is the first time since the lockdown was first enforced in March that Mumbai had higher vehicle congestion than New Delhi (see chart 6).

 

A slack in the weekly numbers has come in the wake of the news that the government is pushing public-sector companies to invest more in cushioning the pandemic effects on growth. The International Monetary Fund on October 14 cut its growth expectations for India’s economy. It now expects a 10.3 per cent contraction for 2020-21, against 4.5 per cent projected earlier.