Growth in India's factory activity slowed to a four-month low in February as new orders eased and weighed on output after manufacturers raised prices at the fastest pace in a year, a business survey showed on Wednesday. That suggests retail inflation could continue to pick up over coming months, pressuring the Reserve Bank of India (RBI) to raise interest rates despite concerns that tighter policy could weigh on economic growth. The Nikkei Manufacturing Purchasing Managers' Index, compiled by IHS Markit, fell to 52.1 in February from January's 52.4 and was below the 52.8 expected in a Reuters poll.

Growth in India's factory activity slowed to a four-month low in February as new orders eased and weighed on output after manufacturers raised prices at the fastest pace in a year, a business survey showed on Wednesday. That suggests retail inflation could continue to pick up over coming months, pressuring the Reserve Bank of India (RBI) to raise interest rates despite concerns that tighter policy could weigh on economic growth. The Nikkei Manufacturing Purchasing Managers' Index, compiled by IHS Markit, fell to 52.1 in February from January's 52.4 and was below the 52.8 expected in a Reuters poll.