Business resumption activities declined for the second consecutive week after a multi-week increase since the ebbing of the second wave of the pandemic, Japanese brokerage Nomura said on Monday.

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The Nomura India Business Resumption Index fell to 95 for the week ended August 1, from 95.9 in the previous week, a statement from the brokerage said, adding that the level of activity is now 5 percentage points (pp) below the pre-pandemic levels.

It said over the week, Google workplace mobility and the Apple driving index rose by 2.6 pp and 0.2 pp, respectively, while Google retail and recreation mobility fell by 0.4 pp. Power demand declined for the third consecutive week, contracting by 3.6 percent, and the labour participation rate also fell to 39.8 percent from 41.1 percent previously.

This is similar to the post-first wave situation, when business resumption reached the near-normal peak, before consolidating. "The key question is whether this softness will persist," the brokerage said.

The imminent risk to near-term growth is the third wave, with the recent uptick in pandemic cases, and the 'R count' crossing 1 for the first time since the decline of the second wave, it warned.

The recent pickup in the pace of vaccination — 47 lakh doses a day in the past seven days as against 37 lakh for the rest of July — and high seroprevalence in some states, could offer some buffer, it added.

First Published:Aug 2, 2021 10:58 PM IST