GDP growth hits 9-yr low of 5.3% in Q4FY12

India’s economy grew 5.3% during January-March (Q4), the eighth successive quarterly decline, and the slowest pace in nine years. For the full year, the economy grew 6.5%.
  • Language
  • App
  • Subscriptions
  • Specials
  • Sign-In
  • Register
GeStepAhead Travelcafe
moneycontrol.com

Home » News » Economy

May 31, 2012, 03.11 PM | Source: CNBC-TV18

GDP growth hits 9-yr low of 5.3% in Q4FY12

India’s economy grew 5.3% during January-March (Q4), the eighth successive quarterly decline, and the slowest pace in nine years. For the full year, the economy grew 6.5%.

Like this story, share it with millions of investors on M3

GDP growth hits 9-yr low of 5.3% in Q4FY12

India’s economy grew 5.3% during January-March (Q4), the eighth successive quarterly decline, and the slowest pace in nine years. For the full year, the economy grew 6.5%.

Post Your Comments

Share Cancel

Moneycontrol Bureau

India’s economy grew 5.3% during January-March (Q4), the eighth successive quarterly decline, and the slowest pace in nine years. For the full year, the economy grew 6.5%.

The only silver lining to the otherwise gloomy outlook is that most economists now expect inflation to remain capped around current levels, with growth having fallen so sharply. All eyes are now on the Reserve Bank of India; expectations of the central bank cutting interest rates at its June 17 meeting have gone up with the latest dismal GDP number.

For the fourth quarter, services grew 7.9% compared to 10.6% last year, farm sector growth fell to 1.7% from 7.5%, manufacturing sector logged negative growth of 0.3% against 7.6%, and construction sector growth fell to 4.8% from 8%.

What is worrying economists is the slowdown in the services segment, which had been cushioning the decline in GDP growth.

C Rangarajan, chairman, Prime Minister’s Economic Advisory Council said that RBI would find it difficult to reduce interest rates if inflation continued to remain high. But many players feel it is now time for the central bank to shift attention to growth from inflation, in order to prevent the situation from worsening.

The 30-share Sensex slipped 225 points to 16086 after the GDP figure was announced, but recouped losses soon after and is around 16123.

The yield on 10-year government bond has fallen to 8.43%. These indicate that both the stock and bond markets are betting on the RBI reducing interest rates at its next meeting on June 17.

Foreign brokerages like Morgan Stanley, CLSA, Goldman Sach and Merrill Lynch had lowered their GDP forecast for FY13 to 6.3-6.6% from around 7% earlier. And while Rangarajan is hopeful that India’s GDP can still grow between 6.5-7% this year, most analysts see that number being closer to 6%.

Ads by Google

Buy, Hold, Sell ? Hear it first on M3
GDP growth hits 9-yr low of 5.3% in Q4FY12

See all

Get started using your favorite social network

or

Login using moneycontrol ID

Username
Password

Need help logging in? Reset password.

Don´t have an account? Sign Up

Get started using your favorite social network

or

Simply sign up using this short form

* mandatory

UserName*

Username should be atleast 4 character

Password*

Password should be 8 or more characters,
atleast 1 number, 1 symbol & 1 upper case letter

Alert

Your Password should contain
  • 8 or more characters
  • At least 1 number
  • At least 1 symbol
  • At least 1 upper case letter
Confirm Password*
Email
Already have an account? Login