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India to grow at 7.5% in 2018, 2019: Moody’s
Why in the news ?
- The Global credit rating agency Moody’s Investors Service expects the Indian economy to grow by around 7.5 per cent in 2018 and 2019.
- However, the company expects the country’s economy to grow at a higher rate of 7.7 per cent in the first quarter of 2018.
More in the news
- According to the firm, PMI (Purchasing Managers Index) and the index of eight core industries (ECI) shows robust activity in the industrial sector.
- Further it is supported by strong urban and rural demand and improved industrial activity
- Thus, the agency said that despite external headwinds from higher oil prices and tightening financing conditions, growth prospects for the remainder of the year remain in line with the economy’s potential.
- Besides, the agency said that the Reserve Bank of India (RBI) is expected to continue on a steady monetary policy tightening path into 2019.
- It pointed out that a rise in core inflation and vulnerability to tightening external financial conditions as the main concerns behind the trend.
- The run-up in energy prices over the past few months will raise headline inflation temporarily.
- The impact on food inflation from increased procurement prices to farmers, will be mitigated somewhat by the expected rise in farm output because of a good harvest.
- Moody’s put G20 growth at 3.3% in 2018 and 3.1% in 2019.
- The advanced economies will grow 2.3% in 2018 and 2% in 2019.
- And it expects the Indian economy to grow around 7.5% in 2018 and 2019.
Source
The Hindu, Indian Express.