Q2 GDP likely to recover to 6%: SBI Research

Source: The Economic Times, Oct 30, 2017

MUMBAI: India’s second quarter growth may surprise on an upside, after three-year low recorded in Q1’18. Several indicators like manufacturing indices, passenger and freight traffic and corporate earnings during the quarter point to higher growth in the latest quarter which could be higher than 6%. The year growth could be over 7%, said a report by State Bank of India.

“Q2’18 GDP growth may surprise on an upside after the Q1’18 growth was at a 17-month low,” said a report by SBI’s research team. “Several indicators like manufacturing indices, passenger and freight traffic and corporate earnings during the quarter point to higher growth in the latest quarter which could be higher than 6%. The YoY growth could be over 7%, the report said.

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Cash ban, GST to cool GDP growth to 4-year low at 6.7%, shows poll

Source: Business Standard, Oct 26, 2017

Bengaluru: India’s economy will likely grow at its slowest pace in four years this financial year, a Reuters poll showed, as a currency ban and the new goods and services tax (GST) have disrupted business activity and dampened consumer demand.

Asia’s third-largest economy will grow at 6.7 per cent in the financial year ending March 2018, the slowest since the new methodology of measuring gross domestic product (GDP) was introduced in the 2014-15 financial year, according to the latest poll of 30 economists.

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IMF pares India’s FY18 growth forecast but sees it regaining ‘fastest-growing’ title in FY19

index.jpgSource: The Economic Times, Oct 11, 2017

NEW DELHI: The International Monetary Fund (IMF) has pared India’s growth forecast for FY18, citing the lingering impact of demonetization and disruption caused by the goods and services tax (GST) but expects a revival as structural reform bears fruit. That will help India win the title of fastest-growing economy back from China.

The Indian economy will grow 6.7% in FY18 against 7.2% estimated earlier, according to the latest edition of the IMF’s flagship World Economic Outlook. FY19 growth is pegged at 7.4% against 7.7% estimated earlier. This comes as global growth is set to pick up pace and China expands faster at 6.8%, marginally ahead of India.

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Asian Development Bank cuts India’s growth forecast to 7% from 7.4%

downloadSource: The Economic Times, Sept 27, 2017

NEW DELHI: The Asian Development Bank (ADB) has lowered India’s GDP growth forecast for the current fiscal to 7% from 7.4% it estimated in July, citing weakness in private consumption, manufacturing output and business investment. The latest growth projection is also lower than the 7.1% GDP growth recorded in 2016-17.

For 2018-19, the multilateral lending agency pencilled in 7.4% growth, down from the earlier forecast of 7.6%. The bank is, however, bullish on growth gaining traction on reforms. “Private consumption is expected to pick up on the back of low inflation and anticipated wage hikes.

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OECD cuts India’s FY18 growth outlook

download.jpgSource: The Economic Times, Sept 22, 2017

NEW DELHI: The Organisation for Economic Co-operation and Development has trimmed India’s growth forecast for the current financial year, citing the temporary impact of the rollout of the goods and services tax and demonetisation, expecting the economy to expand at a slower pace than China.

OECD said India’s economy will likely grow 6.7% in FY18, lower than its estimate of 7.3% in June.

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Current account deficit seen at 1.2-1.3 per cent of GDP in FY18: Icra

download (1)Source : Economic Times, Sept 17, 2017

India’s current account deficit (CAD), which widened to a four-year high in April-June, is likely to touch USD 30-32 billion, or 1.2-1.3 per cent of GDP by March-end 2018, says a report.

CAD increased to USD 14.3 billion, or 2.4 per cent of gross domestic product (GDP), in the first quarter of the current fiscal from USD 0.4 billion in the year ago period. In FY17, CAD was at USD 15.2 billion, or 0.7 per cent of GDP.

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GDP growth likely at 7.1% in FY 18: Nomura

Source: The Hindu Business Line, Sept 13, 2017

New Delhi: India’s GDP growth is expected to be around 7.1 per cent this fiscal following a likely pick-up in industrial production as firms resort to ‘restocking’ post GST, especially ahead of the festive season, says a Nomura report.

According to the Japanese financial services major, post GST restocking is likely to drive a faster pace of industrial output growth in the coming quarters.Before the implementation of Goods and Services Tax (GST), destocking was triggered largely owing to a steep fall in demand from consumers as they delayed purchases. Post GST implementation, restocking might pick up in anticipation of rising demand conditions.

Nomura further said the ongoing remonetisation will have a positive impact on the cash-intensive services sectors and this, in turn, will help to augur growth numbers.

“On the growth front, we expect industrial production to gradually pick up as firms focus on restocking after GST and especially ahead of the festive season; hence, we think the recovery will likely continue to be led by consumption,” Nomura said.

“Overall, we expect GDP growth of 7.1 per cent year-on-year and GVA growth of 6.7 per cent in 2017-18 (year ending March 2018),” it said.

According to Central Statistics Office (CSO) data, the index of industrial production (IIP) during July slipped to 1.2 per cent on account of a poor manufacturing show, while retail inflation rose to a 5-month high of 3.36 per cent in August due to costlier vegetables and fruits.

Commenting on the data, the report said, “Overall, the industrial production data suggest that the industrial growth recovery is still uneven with weak investment demand, but also currently depressed due to GST effects”.

Regarding inflation data, it said that while demand-side price pressures remain contained, supply side and statistical factors such as food prices, GST and HRA are driving inflation higher.