India likely to clock 6.7% GDP growth as GST impact fades: Morgan

A number of high frequency growth indicators points to the fact that end demand is holding up well and is running counter to the slowdown exhibited in the national accounts, as per a Morgan Stanley report.

As GST-related disruptions begin to settle down, India is likely to clock 6.7 per cent GDP growth this fiscal. India’s economic growth slipped to 5.7 per cent in April-June, underlining the disruptions caused by uncertainty related to the GST rollout amid slowdown in manufacturing activities, a PTI report said.

Commenting on the GDP numbers, Morgan Stanley said, “We are inclined not to read this as a sign of general slowdown in aggregate demand”.

“Indeed, we remain skeptical that the GDP statistics are fully reflecting the underlying growth trends in the economy,” said a research note by Morgan Stanley. A number of high frequency growth indicators points to the fact that end demand is holding up well and is running counter to the slowdown exhibited in the national accounts, it added.

“We believe that June 2017 likely marked the trough in growth in this cycle and we expect GDP growth to accelerate by almost 200 bps to 7.5 per cent year-on-year in March 2018 quarter,” it said.

 
Source: PTI

Event date: 
Thursday, September 7, 2017

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