India Economic Outlook
November 17, 2020GDP likely recovered relatively robustly in Q3 (Q2 FY 2020) as large swaths of the economy came back online, leading to a softer contraction in the industrial and services sectors, while agricultural output should have expanded at a stronger pace. Turning to Q4 (Q3 FY 2020), economic activity should be improving: In October, the services sector PMI posted the first expansion since March, while the manufacturing PMI indicated output growth hit a 13-year high. However, shrinking employment in October and lingering targeted containment measures likely continue to weigh on household spending. In November, the government outlined the third installment of stimulus to combat the fallout from Covid-19, focusing largely on credit growth, job creation and infrastructure. Total spending on Covid-19 relief amounts to roughly 2.0% of GDP now—but will likely have a limited impact on the ongoing recovery and its fiscal position.
India Economic GrowthThe economy is projected to decline in FY 2020 (April 2020–March 2021) as Covid-19 containment measures hamper domestic activity and external demand. Moreover, the ongoing spread of the virus and potential snap-back of lockdown measures, coupled with fiscal stimulus measures falling well short of the mark, continue to pose a downside risk to the outlook. FocusEconomics panelists project GDP to fall 9.3% in FY 2020, which is down 0.2 percentage points from last month’s forecast, and increase 9.2% in FY 2021.
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|Bond Yield||6.50||-0.04 %||Jan 01|
|Exchange Rate||71.23||-0.09 %||Jan 01|
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India Economic News
November 13, 2020
Merchandise exports fell 5.6% annually in October (September: +6.0% year-on-year).
November 12, 2020
Industrial output increased a modest 0.2% year-on-year in September (August: -7.4% yoy).
November 12, 2020
Consumer prices rose 1.27% from the previous month in October, accelerating from the 1.10% rise seen in September.
November 2, 2020
The composite Purchasing Managers’ Index (PMI) produced by IHS Markit rose to 58.0 in October from 54.6 in September, marking the strongest increase in roughly nine years as Covid-19 containment measures were loosened.
October 15, 2020
Merchandise exports grew 6.0% year-on-year in September (August: -13.1% year-on-year).