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BENGALURU - India's economic growth cooled to 4.5% in the July-September quarter from the same period a year earlier, the weakest pace in more than six years, as consumer demand and private investment weakened and a global slowdown hit exports, government data released on Friday showed.
Economists polled by Reuters had expected growth to slow to
4.7% for July-September from a year earlier, compared with a 5.0% rise the previous quarter.
ANAGHA DEODHAR, ECONOMIST, ICICI SECURITIES, MUMBAI
"The GDP data confirmed fears of weak growth momentum. Measures taken by the government should boost growth in H2, however we will closely monitor high-frequency data. Core sector data for October showed steep contraction. Hence, the weak momentum is likely to have continued in first month of of the third quarter as well."
"A rate cut is definitely on the cards. Although we are skeptical about monetary policy's effectiveness in boosting growth in the current scenario, growth concerns are likely to make a strong case for rate cut."
"Monetary policy clearly has limitations when it comes to boosting growth in the present situation. Hence, fiscal policy will have to do the heavy-lifting to boost growth. Sector-specific measures and increased government spending could be the quickest way to boost growth in the near term."
JOSEPH THOMAS, HEAD OF RESEARCH, EMKAY WEALTH MANAGEMENT, MUMBAI
"Second-quarter GDP at 4.50 % indicates a slump in economic activity and it has become quite pronounced after a slip to 5% in the first quarter. This leads up to an annual growth rate close to 5%."
"Stronger fiscal stimulus is required to stem this fall without which it could be still lower as we move into the next financial year. Measures to stimulate demand needs to be taken immediately, in the absence of which counter cyclical actions may not bear fruit."
(Reporting by Chris Thomas and Derek Francis in Bengaluru; compiled and edited by Rashmi Aich)