There are risks of a weaker rural demand given the projected shortfall in the kharif crop and the continuing impact of El Nino
FinTech BizNews Service
Mumbai, November 13, 2023: Suman Chowdhury, Chief Economist and Head, Research, Acuité Ratings & Research, has an analytical perspective to share as part of a monthly summary of the performance of various economic indicators: “There are two important takeaways from our latest Macro Heat Map. One, the economic report card for the first half of the current fiscal has been strong supported by the high investments in public infrastructure, largely steady consumption demand particularly in the services sector and the ramp up in core industrial activity. These factors along with some base support, is likely to lead to a solid GDP growth of over 6.5% in Q2FY24 following the 7.8% reported in Q1FY24. However, the heat map also gives out early signs of a moderation in economic activity in the second half of the fiscal as reflected from metrics like consumer goods output and diesel consumption in Sep-23.
While the current festive season is likely to push up consumption in Oct-Nov’23, there are risks of a weaker rural demand given the projected shortfall in the kharif crop and the continuing impact of El Nino. Further, the global markets continue to be volatile with the ongoing geo-political risks, higher crude oil prices and the expectation of interest rates to stay higher for a longer period. Accordingly, we remain cautiously optimistic with a GDP growth forecast of 6.0% for FY24.”
