India business confidence rises only slightly in Oct: MNI survey

Rises to 62.3 in October from a more than a 1-1/2 year low of 61.4 in September

India's business confidence rose only slightly in October, despite a bigger-than-expected rate cut from the Reserve Bank of India (RBI), as worries about weak demand continues to impact sentiment, a private survey showed on Tuesday.

The MNI India Business Sentiment Indicator rose to 62.3 in October from a more than a 1-1/2 year low of 61.4 in September, according to MNI Indicators, which is part of Deutsche Borse Group.

MNI said manufacturing and construction companies had reported a rise in sentiment, but noted confidence among service sector companies fell for a fourth consecutive month despite the Reserve Bank of India's rate cut on Sept. 29.

"While sentiment rose in October it was less than expected given the greater than forecast 50 basis point cut in rates, with respondents more concerned about the general malaise in the economy and subdued demand globally," MNI said in a statement.

"Moreover, this month's result was even more disappointing given that this is a festival period when usually there is more business and purchase activity."