India Economic Outlook
September 17, 2019The economy looks set to regain traction in Q2 FY 2019, which runs from July to September, after GDP growth slowed to an over six-year low in Q1 FY 2020. Total rainfall over the June–September monsoon season is on track to reach close to or just above normal levels, which should support agricultural output over the coming months and, more immediately, consumer sentiment, given that approximately half of India’s workforce is dependent on the agriculture sector. Moreover, in July–August, private sector activity grew at a notably faster pace than in Q1, according to PMI data. In addition, the government announced new measures in August to try to stimulate the economy, including several mergers of public-sector banks and the relaxation of FDI rules. On a less positive note, however, vehicle sales have fallen in annual terms in recent months, and slumped in August.
India Economic GrowthThe economy is projected to slow in FY 2019 as non-bank financial lenders struggle, restraining the availability of new loans to consumers and businesses. Weak public finances, tense relations with Pakistan and a slowing global economy will also weigh on the outlook. More positively, a close-to-normal monsoon season and lower interest rates are seen supporting growth. Our panelists expect GDP growth of 6.5% in FY 2019, which is down 0.3 percentage points from last month’s estimate, and 6.9% in FY 2020.
India Economy Data
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|Bond Yield||6.55||-0.04 %||Sep 04|
|Exchange Rate||71.99||-0.09 %||Sep 04|
|Stock Market||36,725||-0.08 %||Sep 04|
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India Economic News
September 13, 2019
Merchandise exports declined6.0% year-on-year in August, amounting to USD 26.1 billion, contrasting July’s 2.3% increase.
September 12, 2019
In August, consumer prices rose 0.49% compared to the previous month, down from July’s 0.91% increase.
September 12, 2019
Industrial production increased 4.3% year-on-year in July, up from June’s revised 1.2% reading (previously reported: +2.0% year-on-year).
September 5, 2019
The composite Purchasing Managers’ Index (PMI) produced by IHS Market decreased to 52.6 in August from 53.9 in July, which represented the highest reading since November 2018.
August 30, 2019
In Q1 FY 2019, which ran from April to June, the economy grew 5.0% compared to the same period a year earlier, well below Q4 FY 2018’s 5.8% expansion and market analysts’ expectations of 5.7% growth.