India sees strong rebound in GDP growth for March quarter

NEW DELHI - GDP growth in India picked up sharply in Q3 FY2018 (fiscal year ending March 2018) to 7.2% y/y from 6.5% y/y previously. GVA (Gross value added) based growth also strengthened on the back of stronger industrial activity.

ANZ Bank says investment also rebounded sharply, presumably reflecting strong public infrastructure spending. By contrast, private consumption moderated for the fourth successive quarter.

“Looking ahead, our FY2019 GDP forecast of 7.2% faces downside risk after the Reserve bank of India (RBI) tightened the norms for the resolution of stressed assets,” ANZ says.

“Taking into consideration the above factors and the evolving inflation trajectory, we expect the RBI to maintain its policy repo rate at 6.00% through 2018.

“However the strong rebound in Q3 will only add to the hawkish rhetoric of the central bank.”  www.live.anz.com (ATI).