Q3 GDP On Expected Lines, Say Economists And Analysts

India's GDP for the third quarter ending Dec 31, 2022 came in at 4.4%. The reduction in GDP is largely on account of the fact that the low base effect seen due to the covid impact has waned.
Economists at the State Bank of India had projected a GDP growth of 4.6 per cent for the December quarter.

Says Ritika Chhabra- Quant Macro Strategist - Prabhudas Lilladher PMS, " The Q3 GDP growth rate at 4.4% is on expected lines. The loss in growth momentum is due to fading away of favorable base effect, slowdown in pent up demand due to high inflation & interest rates and contraction in manufacturing sectors. Some of the high frequency indicators were already pointing at muted growth for the quarter vs Q2, hence, lower GDP growth rate in Q3 didn't come as a surprise."

Nish Bhatt, Founder & CEO, Millwood Kane International too believes that the GDP is in line with estimates. "The Q3FY23 GDP at 4.4% is very much on the expected lines. The growth rate has slowed down due to higher inflation and lower consumption. The data looks optically lower but the fact it is coming on a revised higher base than last year is encouraging. Low private consumption has been primarily responsible for the lower GDP print coupled with lower government spending and a contraction in manufacturing.

Construction, Realty & Finance, trade, and hotel components provided support to the data. Finally, the government keeping the FY23 growth estimate unchanged at 7% is positive. The slowing growth rate may lead to some measures to control inflation by the government and the central bank," he says.