INSUBCONTINENT EXCLUSIVE:
per cent on low automobile sales, deceleration in air traffic movements, flattening of core sector growth and declining investment in
construction and infrastructure, and the growth forecast for FY20 has now come down to 5 per cent from 6.1 per cent earlier, an SBI report
said.State Bank of India (SBI) joins all other global agencies -- the ADB, World Bank, OECD, RBI and the IMF -- in downgrading India's
FY20 growth rates."Based on our composite leading indicator that suggests the GDP growth to slow down further from 5.0 per cent in Q1 of
FY20 to 4.2 per cent on account of low automobile sales, deceleration in air traffic movements, flattening of core sector growth and
declining investment in construction and infrastructure", the bank said in a report.Country's GDP was already at the 6-year lowest of 5
"Our 33 high frequency leading indicators reveal an acceleration rate which was 65 per cent in Q1 FY19 declined sharply to 27 per cent in Q2
Besides that, Skymet also reported that the country as a whole received 110 per cent of the long period average (LPA) of 89 cm of rainfall
during the four-month-long southwest monsoon period, making it to the above normal category, SBI said."Among meteorological divisions,
Central India and Southern Peninsula received the maximum rainfall of 129 per cent and 116 per cent of their LPA, respectively
Excess Monsoon rains and the floods caused by them had affected the Kharif crops in many states, including Madhya Pradesh, Maharashtra,
Gujarat, Karnataka and Punjab."While 40 to 50 per cent soyabean crop has been hit in Madhya Pradesh, which is the biggest producer of the
agrarian states, so this could have a negative impact on the agricultural growth
Considering all these domestic parameters along with the global downturn, we now foresee a GDP growth at 5 per cent in the current fiscal,"
the report said."We expect Q2GDP growth at 4.2 per cent
Our acceleration rate for 33 leading indicators at 85 per cent in October 2018 is down to just 17 per cent in September 2019, with such
decline gaining traction from March 2019.Even IIP growth number for September 2019 was 4.3 per cent, which is quite alarming
We are revising our GDP forecast for FY20 to 5 per cent from 6.1 per cent earlier," the SBI Ecowarp said."We expect growth rate to pick up
pace in FY21 to 6.2 per cent
We also expect revisions to the GDP data as in the past, but that is likely in February 2020 as is the custom
however, believe this growth rate in FY20 should be looked through the prism of synchronised global slowdown (countries have witnessed
Uncertainty Index when compared globally
We also believe that Moody's change in outlook from stable to negative will not have any significant impact as rating actions are always a
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