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Business Activity Records V-shaped Recovery in June

NOMURA INDEX

Our Bureau

New Delhi:

Business activity in India witnessed a gradual Vshaped recovery in June from the low seen in May showed data released so far, according to brokerage firm Nomura.

However, a third wave of Covid-19 remained a key risk to economic recovery with slowing vaccination pace and increased mobility in July, the firm said in a note on Monday.

The Nomura India Business Resumption Index (NIBRI), which tracked high frequency indicators such as mobility indices and power consumption, accelerated to 96.4 for the week ended July 18, from 94.9 the previous week.

“The first flush of conventional monthly data for June suggest a gradual V-shaped recovery from the nadir in May,” said Nomura economists Sonal Varma and Aurodeep Nandi in the note.

Mobility indicators like Google’s workplace and retail and recreation mobility indices continued to rise 2.4 percentage points (pp) and 5.1pp week-on-week, respectively. Meanwhile, India’s vaccination pace slowed marginally to 3.6 million doses per day in July from 3.8 million in June, it said. “With mobility continuing to pick up through July and broader vaccination coverage still a quarter away, the key risk to growth recovery is the threat of a third wave during this period,” Nomura said.

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