Investors and policymakers will be closely watching India’s fourth-quarter and full fiscal year 2012/13 gross domestic product (GDP) growth figures on Friday.
The economy grew 4.5 percent in the December quarter, but a Reuters poll has shown that Asia’s third-largest economy will likely perform a little better and expand by 4.8 percent in the quarter that ended in March.
For the financial year 2013, the government had estimated the economy will grow 5 percent, the lowest in a decade. However, if the poll consensus proves right, full-year growth will be worse than the government’s estimate.
This economic data will set the tone for further interest rate action by the Reserve Bank of India, especially in the current scenario where hopes of a rate cut have risen after inflation fell below 5 percent in April.
Here are some growth estimates and outlook from investment banks:
J.P.MORGAN: The investment bank expects January-March growth at 4.9 percent as compared to 4.5 percent in the previous quarter, largely on the back of a recovery in services. This will bring growth for the full fiscal year to 5 percent, down from 6.2 percent in the previous financial year, the bank said. “From the expenditure side, improved net exports and a modest upturn in investment should be the growth drivers. Much of this is anticipated by the market and the government and thus is unlikely to cause any flutter,” economists at JP Morgan wrote in a note to clients.