Here is that you need to know ahead of the MOSPI announcing the actual GDP numbers for the Sep-20 quarter on November 27.
· Markets are rife with speculation about the likely rate of contraction in the second quarter. Remember, contraction is already a fait accompli.
· Going by the indicators like IIP, core sector and the PMI, there is some scope for being optimistic. Indications are that the GDP contraction could be less than expected.
· In the second quarter so far, based on high frequency data, manufacturing contraction was only 5.9%, compared to 35.7% contraction in Q1.
· Similarly, output of capital goods, with strong externalities, had contracted by only 13.6% in Q2, compared with 65.34% in Q1.
· Leading economists expect GDP to have contracted by 8% in Q2, while some are going as good as 7% based on the high frequency data.
· In the first six months of the fiscal, government spending and rural demand appear to have saved the day even as GST collections are back to pre-COVID levels.
· If the final GDP contraction in Q2 is less than the originally anticipated 10.5%, that should come as a major boost to the Indian economy.
Here is that you need to know ahead of the MOSPI announcing the actual GDP numbers for the Sep-20 quarter on November 27.
· Markets are rife with speculation about the likely rate of contraction in the second quarter. Remember, contraction is already a fait accompli.
· Going by the indicators like IIP, core sector and the PMI, there is some scope for being optimistic. Indications are that the GDP contraction could be less than expected.
· In the second quarter so far, based on high frequency data, manufacturing contraction was only 5.9%, compared to 35.7% contraction in Q1.
· Similarly, output of capital goods, with strong externalities, had contracted by only 13.6% in Q2, compared with 65.34% in Q1.
· Leading economists expect GDP to have contracted by 8% in Q2, while some are going as good as 7% based on the high frequency data.
· In the first six months of the fiscal, government spending and rural demand appear to have saved the day even as GST collections are back to pre-COVID levels.
· If the final GDP contraction in Q2 is less than the originally anticipated 10.5%, that should come as a major boost to the Indian economy.