State Bank of India Launches ‘SBI Composite Index’

State Bank of India (SBI) based on its internal loan portfolio and data available in public domain has developed a conservative yet robust forward-looking economic indicator - the SBI Composite Index - for tracking primarily manufacturing activity in the country. SBI, being the largest lender in the country, its loan portfolio mirrors the credit demand in the country.

Speaking on the occasion, Smt. Arundhati Bhattacharya, Chairman, SBI said, “The Index will analyse data from both manufacturing and services industries to determine expansion or contraction in the economy. The SBI Composite Index will help policy makers, market participants and the like to identify the turning points in the manufacturing cycles in advance and adjust their investment or marketing strategy”.

SBI will publish the indicator on a monthly basis. This indicator will track two months in advance the possible trends in official estimates. This forward looking indicator takes into account detailed activity/traction in consumer spending, mining activity, interest rates, inflation, exchange rates, SBI lending and performance of various thematic indices.

SBI Composite Index will capture two components of the manufacturing cycle namely month-on-month and year-on-year growth. Accordingly, two separate indices have been constructed and both the indices are on a scale of 0 to 100. Index above 50 implies growth over previous respective period and less than 50 will suggest a contraction over respective period.