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PremiumIndia Q2 GDP data Highlights: The Indian economy grew 7.6 per cent during the July-September quarter of the current financial year 2023-24 (Q2FY24), remaining the fastest-growing major economy in the world, according to gross domestic product (GDP) data released on Thursday, November 30.
‘’The real GDP or GDP at constant (2011-12) prices in Q2 2023-24 is estimated to attain a level of ₹41.74 lakh crore, as against ₹38.78 lakh crore in Q2 2022-23, showing a growth of 7.6 per cent, compared to 6.2 per cent in Q2 2022-23'', data from Ministry of Statistics and Programme Implementation showed on Thursday.
Economists expected the growth rate to slow down in Q2 of this financial year as compared to last quarter where it registered robust growth of 7.8 per cent. The Reserve Bank of India (RBI) prediction data estimated the GDP growth to be 6.5 per cent for the September quarter. According to a Reuters survey, India's growth was expected to be around 6.8 per cent in the July-September quarter compared to the same period last year.
Stay tuned to our Q2 GDP live blog for constant updates!
India's growth would give space to the RBI, which held its rates for the fourth consecutive policy meeting in October, to focus on food inflation, which it believes is uncomfortably high.
"An economy on fire, and the persistent food inflation threat, suggest to us that the RBI will be in no hurry to loosen policy," Capital Economics' Thamashi De Silva said. De Silvia said she expected the central bank to start its easing cycle in the second half of 2024, much later than most major emerging economies.
Raghvendra Nath, MD, Ladderup Wealth Management said, “GDP came out at 7.6 per cent, much higher than the general consensus. The continued robust growth of the Indian economy was owed to the growth in the manufacturing and mining sector. India continues to remain the fastest growing major economy in the world. With the robust growth reported in India along with China still in a troubled situation, we can expect healthy inflows in Indian equity markets, with Nifty 50 being pushed to new highs."
On India's Q2 GDP print, Chief Economic Advisor (CEA) V Anantha Nageswaran said, ‘’Based on current trends, it is possible that India may be underestimating its GDP growth and not overestimating it. We retain the FY24 GDP growth forecast of 6.5 per cent, but we will rework the numbers to see if the July-September growth data adds an upside to the forecast.''
Mr. Vivek Rathi, National Director Research, Knight Frank India said, “The share of private consumption in the GDP has decreased, there is a noticeable increase in the share of investments, as reflected in the Gross Fixed Capital Formation (GFCF). This suggests a shift in the economic landscape, where, despite private consumption being a key driver of economic growth, investments are gaining momentum.
The growth in investments holds significance for the revival of the Capital Expenditure (CapEx) cycle in the economy, which, in turn, supports long-term growth.''
Madhavi Arora, Lead Economist, Emkay Global, Mumbai said, "The buoyant growth is being underpinned by cyclical factors like robust corporate profits, a strong fiscal impulse, with government spending being front-loaded in a pre-election year, and a boisterous financial sector."
"However, we expect GDP growth to slow in the second half of FY24 (due to) cyclical headwinds in the form of relatively slower government spending, fading benefits of lower commodity prices on YoY basis, sub-par agriculture performance, tighter lending standards and weaker exports."
As per the National Statistical Office (NSO) data, the GVA (Gross Value Added) of the agriculture sector recorded a 1.2 per cent growth, down from 2.5 per cent in the July-September quarter of 2022-23. Gross fixed cap formation growth at 11 per cent compared to 9.6 per cent (YoY) and 8 per cent (QoQ)
The growth in GDP during the April-September period in 2023-24 stood at 7.7 per cent compared to 9.5 per cent in the first half of the last financial year. The GDP growth in the first quarter of the current fiscal remained unchanged at 7.8 per cent.
Radhika Rao, Senior Economist, Dbs Bank, Singapore said, "India's second-quarter real GDP showed that the strength in domestic demand surfaced as a key counterweight to global uncertainties and monetary tightening, even after accounting for base effects. Government consumption, fixed-asset investments, lower input prices and inventory restocking were likely key catalysts, while private consumption missed expectations."
The manufacturing sector, which for the past decade has accounted for just 17 per cent of the economy, expanded 13.9 per cent year-on-year in the September quarter, compared with a revised 4.7 per cent in the previous three months.
Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank, Mumbai said, "The sharp upside surprise to the second-quarter GDP figures is a welcome sign, especially as it comes in the backdrop of a broad-based pickup across most non-agricultural sectors."
"We, however, expect the second-half growth to moderate. Having said that, the full year GDP numbers have got a big fillip after today's figures."
Real GDP or GDP at Constant (2011-12) Prices in Q2 2023-24 is estimated to attain a level of ₹41.74 lakh crore, as against ₹38.78 lakh crore in Q2 2022-23, showing a growth of 7.6 per cent as compared to 6.2 per cent in Q2 2022-23, data from Ministry of Statistics and Programme Implementation showed on Thursday.
India's benchmark bond yield posted its biggest monthly drop in six in November, tracking a plunge in US Treasury yields, as investors turn to central bank monetary polices in the last month of the year. The 10-year benchmark bond yield ended at 7.2803 per cent, down eight basis points in November, the biggest drop since May.
The output of eight key infrastructure sectors rose by 12.1 per cent in October 2023 against 0.7 per cent expansion in the year-ago period, according to the official data released on Thursday. All the sectors except for fertiliser recorded healthy production growth in the month under review.
The core sector (coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity) growth in September was 9.2 per cent. Coal, steel, cement and electricity production recorded double-digit growth.
April-October Fiscal Deficit Data shows revenue gap ₹2.80 lakh crore compared to ₹3.85 lakh crore (YoY). Spending stood at ₹23.94 lakh crore vs ₹21.44 lakh crore (YoY). October Fiscal Deficit Data shows fiscal deficit ₹1.02 lakh crore compared to ₹1.38 lakh crore (YoY). Spending sttod at ₹2.75 lakh crore compared to ₹3.20 lakh crore (YoY)
Rupee fell to its lifetime closing low on Thursday and was the worst performer among key Asian peers in November which have rallied amid a slump in U.S. yields and the greenback.
Likely intervention from the Reserve Bank of India limited further downside for the local unit on Thursday, five traders said.
The rupee ended at 83.3950 against the U.S. dollar, lower by 0.08 per cent, compared with its previous close at 83.3250. The local unit posted a slight monthly loss of 0.1 per cent.
In the corresponding period last year, the deficit was 45.6 per cent of the budget estimates of 2022-23. For 2023-24, the fiscal deficit of the government is estimated to be ₹17.86 lakh crore or 5.9 per cent of the GDP.
The government's fiscal deficit at the end of October touched 45 per cent of the full-year budget estimate, according to data released by the Controller General of Accounts (CGA) on Thursday. In actual terms, the fiscal deficit -- the difference between expenditure and revenue -- was ₹8.03 lakh crore during the April-October period of 2023-24.
Sensex rose 4.9 per cent while the Nifty 50 jumped 5.5 per cent in November. This was Nifty's best month since July 2022. For the Sensex, it was the best month since October 2022.
Rumki Majumdar, Economist, Deloitte India says, ‘’A few high frequency numbers such as credit growth, flights taken, suggest that services sector remains buoyed as consumers spending picks up. A build up to festive season bodes well for the economic activity.
We are also expecting the industry sector to do well as seen in the rebound in auto sales, IIP manufacturing numbers, and strong corporate profits in sectors such as capital goods, cement and electronics.
Overall, we expect GDP to be around 6.4% - 6.7% YoY in the July-September quarter.''
India Q2 GDP data LIVE Updates: Indian Credit Rating Company (ICRA) predicted 7 per cent GDP growth in Q2. It also estimated GVA growth to be around 6.8 per cent in Q2 a slump from 7.8 per cent in Q1.
India Q2 GDP data LIVE Updates: The Indian rupee appreciated for the third consecutive day and by 2 paise to 83.30 against the US dollar on Thursday. This appreciation follows positive cues from equity markets and sustained foreign fund inflow ahead of release of GDP data.
India Q2 GDP data LIVE Updates: Head Retail Research at HDFC Securities, Deepak Jasani said, “India’s GDP for Q2FY24 will likely be in the 6.8- 7 per cent band (vs 7.8 per cent in Q1FY24) due to normalising base, erratic monsoon (though having benevolent impact on some sectors like mining), rural economic challenges, delays in festive activities and a deceleration in government capital expenditure. However, this number will still be higher than the RBI MPC forecast of 6.5 per cent," reported financialexpress.
India Q2 GDP data LIVE: Chief Investment Strategist at Geojit Financial Services, VK Vijayakumar said, “Global cues are supportive with positive news from the mother market US where growth is strong and inflation is trending down. India's Q2 GDP numbers expected today will be better than expected. If these good macros are supported by today's exit poll results coming in tune with market expectations, a rally to record highs can happen soon."
India Q2 GDP data LIVE Updates: India's data of 5-year average rolling return of 8.9 percent and a Sharpe ratio of 1.29 have outperformed developed counties like the US, Japan, UK, France and Germany.
India Q2 GDP data LIVE Updates: India’s real GDP growth numbers performing relatively better as compared to global counterparts. India registered a growth rate of 7.20 percent in the last financial year, driven by robust private consumption and industrial production.
India Q2 GDP data LIVE Updates: “India’s economy is expected to continue its strong growth trajectory, with real GDP growth projected to be higher than the long-term average in FY2024." states Client Associates report.
India Q2 GDP data LIVE: Indian Institute of Packaging (IIP) data available till September suggests that consumer goods output grew by 3.7 per cent year over year in the first half of the year. It also suggested that consumer durables production actually declined by 0.7 per cent year over year.
India Q2 GDP data LIVE Updates: The NSE Nifty 50 index rose to 20,130.10 points by 0.17 percent and the S&P BSE Sensex rose to 66,995.97 by 0.15 percent at 9:16 am.
