India's industrial output in June expanded at its slowest pace in 13 months, official data showed Thursday, as Asia's third-largest economy shows signs of cooling. Production from factories, mines and utilities grew 7.1 percent from a year earlier, compared with a forecast rise of at least eight percent. The figures reflected the impact of higher output a year earlier, when production picked up as India's economy began rebounding from the global financial crisis, economists said. The 7.1 percent expansion marked a sharp deceleration from May's revised growth of 11.3 percent. Manufacturing output, which accounts for 80 percent of the industrial output index, rose 7.3 percent in June compared with eight percent a year earlier. Industrial output had been lifted by government spending and aggressive monetary easing to shield the economy from the global economic crisis, but those measures are now being unwound as India recovers. While the June number 'suggests a moderation from the feverish pace of activity seen until now, it does not indicate a collapse in industrial activity,' said Standard Chartered economist Anubhuti Sahay. However the weaker than expected numbers will give the central bank pause for thought as it weighs its next rate hike, analysts said. Economists are awaiting July inflation figures next week, which could affect the pace of the Reserve Bank of India's monetary tightening. 'The rate hikes will continue but at a moderate pace. If they go too fast they will choke the economy. The global economic environment is quite fragile,' D.K. Joshi, economist at leading credit rating agency Crisil, told selfnews. Most economists forecast that interest rate hikes will amount to another 50 basis points in the remainder of 2010. With headline inflation running at 10.55 percent, the central bank has raised rates four times this year, hoping to check price increases that it has said are becoming 'generalised'. The government expects India's economy to grow 8.5 percent in the financial year to March 2011 after expanding 7.4 percent last year. New Delhi warned last week that overly aggressive rate hikes could derail economic recovery, while promising to do everything possible to tame prices. The left-leaning Congress-led government has come under relentless fire from an opposition that accuses it of failing to protect India's poorest from surging prices. Data released Thursday showed weekly food inflation accelerated to 11.40 percent year-on-year from 9.53 the previous week, but still down from its peak at over 20 percent last December. 