Commodity News- India's GDP growth may ease to 7.2% in Jul-Sep: ICRA
After the strong upswing in the April-June quarter, GDP growth for July-September is expected to dip to 7.2% due to sluggishness in agriculture and industry, credit rating agency ICRA said in its latest report.
It can be noted that the GDP had grown by a higher than expected 8.2% in the first quarter of the fiscal as compared to the year-ago period. Official data on quarterly growth will be released at the end of this month.
The dip in the growth number will be largely on account of a pull-down from an industry where growth is expected to slow down to 7.1% in the September quarter as compared to 10.3% in June and the farm sector, which may slow down to 3.5% from 5.3%, domestic rating agency ICRA said.
Higher fuel prices and the weak rupee were pointed out as the primary factors dragging the industrial growth, while an uneven and sub-par monsoon, flooding in some areas amid a late withdrawal of the monsoon rains, and instances of crop damage and pest attacks will impact the farm sector.
Pre-tax margins for companies have declined on a quarter-on-quarter basis because of a rise in the input and energy costs and the rupee depreciation, the agency said.
"Overall, we expect manufacturing GVA (gross value added) growth to ease to 7.0 percent in Q2FY19 from the healthy 13.5 percent expansion in Q1FY19," ICRA said.
The agency said higher commodity prices may support a shallow recovery in GVA growth in mining and quarrying from the marginal 0.1 percent in Q1FY19 to around 2.5 percent in Q2FY19, despite a slowdown in volume growth.
Similarly, electricity, gas, water supply, and other utility services and construction activity will also show an upswing due to a variety of sectoral factors, it said.
On agriculture, the agency said the first advance estimates of crop production indicated a decline in kharif output in FY2019 for pulses, coarse cereals, and cotton, and a rise in oilseeds, sugarcane, and rice.
A Special Offer for a Special Season! Get Stock Cash Tips to start from 2 Days Free Trial Click Here- Stock Cash Tips, we provide secure, Smooth Deals You Can Trust.
0 comments