April 24, 2024
The Monetary Policy Committee (MPC) emphasized the importance of sustaining the path of disinflation until inflation reaches the 4% target consistently
Uncertainties stemming from adverse climate events and geopolitical tensions have added complexity to the economic outlook
India's gross domestic product (GDP) surged by 8.4% in the December quarter, exceeding expectations
The Ministry of Statistics also revised its full-year GDP growth estimate upwards from the initial projection of 7.3% to 7.6% for 2023-24
In its April 2024 bulletin, the Reserve Bank of India (RBI) highlighted the country’s resilient domestic growth activity, supported by robust investment demand and positive business and consumer sentiments. Released on April 23, the bulletin emphasized the ongoing strength in domestic economic activity.
The RBI Bulletin, a monthly publication offering insights into domestic and global economic developments, clarified that it does not represent the official views of the central bank. Despite this disclaimer, the bulletin noted the persistent resilience in economic activity, buoyed by strong investment demand and optimistic sentiments among businesses and consumers.
Regarding inflation, the bulletin mentioned that headline inflation has eased since its peak in December 2023. However, it highlighted that food prices have been a factor disrupting the ongoing disinflation process. Furthermore, uncertainties stemming from adverse climate events and geopolitical tensions have added complexity to the economic outlook.
The Monetary Policy Committee (MPC) emphasized the importance of sustaining the path of disinflation until inflation reaches the 4% target consistently. The bulletin stressed that actively disinflationary monetary policy is crucial for anchoring inflation expectations, as price stability lays the foundation for sustained growth.
In a surprising turn, India’s GDP surged by 8.4% in the December quarter, exceeding expectations. Data released by the Ministry of Statistics and Programme Implementation on February 29 revealed this impressive growth rate, surpassing earlier estimates.
The Ministry of Statistics also revised its full-year GDP growth estimate upwards from the initial projection of 7.3% to 7.6% for 2023-24. This revision was unexpected, as economists had anticipated a lower figure around 6.9%.
The latest quarterly GDP growth rate of 8.4% marks the highest in six quarters, indicating a robust economic expansion. The last time India experienced such rapid growth was in the first quarter of 2022-23, when GDP expanded by 13.1%, later revised slightly down to 12.8%.
Source: Moneycontrol