Growth weak as consumers remain on sidelines.
Report
June 8, 2016
India GDP Q1 2016
The Indian economy expanded by 7.9% in the final (March 2016) quarter of the 2015-16 financial year; India is now the fastest-growing major economy.
- The Indian economy expanded by 7.9% over the year to March quarter 2016. India is now the world’s fastest growing major economy.
- This was a consumption-led story, with consumption contributing 4.9%, or 62% to the overall outcome.
- Services (primarily financial, trade, professional and business services) was the best performing industry sector.
- The high statistical discrepancy does raise some concerns about the quality of the data release.
- Industrial production is forecast to accelerate to around 5% by the second half of the year; it is currently flat.
- Equity markets have recently reached a 2016 high, assisted by strong growth in corporate profits.
- NAB Economics is forecasting 7.7% growth in 2016 and 2017.
- A further 25bp cut is expected in the Repo rate in the December quarter, bringing it down to 6.25% b
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