Why in news
India's GDP is expected to grow by 6.8% in Q2 of 2024-25, slightly up from 6.7% in Q1.
The growth forecast comes from an index compiled by the Reserve Bank of India (RBI), based on various high-frequency indicators.
The growth outlook is bolstered by strong domestic economic activities despite geopolitical tensions.
Some key economic indicators, such as GST collections, automobile sales, and manufacturing PMI, have shown a decrease in momentum during Q2.
The slowdown is partly attributed to heavy rains and the cultural period of Pitru Paksha, which affects economic activities.
Despite the slowdown, the RBI noted that the Indian economy has shown resilience, with improved consumer perceptions and optimism among industry players.
There are concerns about high valuations in the stock market and uncertainties from geopolitical conflicts, leading to cautious market behavior.
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