India's Economic Recovery Slower Than Expected: BofA-ML

Global financial services major Bank of America Merrill Lynch has said that Indian economy is recovering at a much slower pace than expected, media reported.

As per reports, the firm reduced its growth forecast for India to 5.5 per cent from 6 per cent for the current fiscal, as per the old GDP series.

India's Economic Recovery Slower Than Expected: BofA-ML
Commenting on the issue, a BofA-ML Official told the media, "Is recovery happening? Yes, but even more slowly than we expected. At the same time, India's relatively faster growth is allowing it to overtake Brazil and Russia in GDP to emerge as the second largest emerging market after China."

"We have cut our GDP forecasts to 5.5 per cent from 6 per cent for 2015-16 and to 6.5 per cent from 7 per cent for 2016-17 (in the old GDP series) on poor rains as well as delays in global recovery and domestic lending rate cuts," he added.

The global brokerage firm also added that the coming months could see a consumption recovery largely driven by four factors which include softer lending rates, public sector salary hikes after the 7th Pay Commission, household savings on lower oil prices and a possible hike in wheat MSP before the early-2017 Punjab/UP polls.

Read more about: economy, gdp
Story first published: Tuesday, October 13, 2015, 9:30 [IST]
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