India: Real GDP growth likely to rise to 7.8% y-o-y in Q2 - Nomura

Wendy Chen, Research Analyst at Nomura, expects India’s real GDP growth to rise to 7.8% y-o-y in Q2 from an already high 7.7% in Q1, led by both consumption and investment.

Key Quotes

“While favourable base effects are in play (due to goods & services tax-led disruptions last year), sequential domestic demand also likely remained solid.”

“On the supply side, growth is likely to be supported by the agriculture and industrial sectors, keeping gross value-added growth unchanged at 7.6% y-o-y.”

“We expect Q2 to mark a cyclical peak in this growth cycle, before moderating to an average of 7.2% in H2 due to tighter financial conditions, high oil prices, slowing global growth, a pullback in spending ahead of elections and adverse base effects.”