GOING BEYOND the headline number, the stellar second quarter Gross Domestic Product (GDP) number presents a mixed bag of sorts: unexpected tailwinds that aided growth during the three month period, and some potential headwinds going forward.
Improved corporate profitability driven by the slide in input prices, a sharp surge in construction activity helped mainly by government-led capital expenditure, alongside some deflator-related issues in accounting — these were some of the factors which were underestimated by most economists in their GDP estimates for the July-September quarter. The result — a stellar 7.6 per cent growth rate, which has prompted most economists to revise up their growth forecast for FY24, even as they underlined the perceptible moderation in private consumption and concerns of a slowdown in the remaining half of the financial year (October-March).
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