India’s quarterly growth falls to nearly two-year low, well below expectations | Wilnesh News

India’s economy grew only 5.4% in the second fiscal quarter ended in September, well below economists’ expectations and close to its lowest point in two years.

The data increased 6.7% from the previous quarter and was the lowest reading since the last quarter of 2022.

this National Bureau of Statistics Manufacturing and mining are growing slowly.

The yield on the country’s 10-year sovereign bonds quickly fell from around 6.8% to 6.74% after the release.

Weak GDP data may affect the country’s interest rate trajectory, with the Reserve Bank of India’s Monetary Policy Committee scheduled to meet between December 6 and 8. Market observers had previously expected the Reserve Bank of India to suspend the repo rate, which currently stands at 6.5%, for the eleventh consecutive time.

Alicia Garcia Herrero, chief Asia-Pacific economist at Natixis, predicted in an interview with CNBC’s “Squawk Box Asia” before the release of GDP that India’s economy will slow down in 2025, but will not “collapse.”

She said Natixis’ growth forecast for India in 2025 was 6.4%, without clarifying whether that referred to the financial year or the calendar year, but added that the actual number could also be as low as 6%, which she believed was “not at all high”. Question, but unpopular. “

In addition, the Reserve Bank of India expects GDP growth in the fiscal year 2024 ending in March 2025 to reach 7.2%.

Asked how India’s economy would fare during President-elect Donald Trump’s second term, Herrero said India was “not really at the center of the value chain restructuring that China has been doing.”

“If I were the Trump administration, I would start (considering tariffs on Vietnam). This is a more obvious example,” she noted.

She said China could produce products in India for Indian consumption instead of exporting products globally, so New Delhi could avoid being hit by tariffs.