Median forecast from a poll of 28 economists is for an annual growth
of 8.2 per cent in the quarter through March, unchanged from the
previous quarter.
Forecasts ranged from 6.3 per cent to 8.9 per cent.
The economy is expected to have grown 8.5 per cent in fiscal year
2010/11 that ended in March, just below the 8.6 per cent estimated by
the government, and up from 8 per cent a year earlier, the poll
showed.
Forecasts for the full fiscal year growth ranged between 8.0 per cent
and 8.7 per cent.
FACTORS TO WATCH
Industrial output grew an annual 7.3 per cent in March, smashing
forecasts on the back of a revival in capital goods production.
Services sector gained momentum in April, with strong growth in new
business orders, a HSBC survey showed early this month.
Manufacturing sector maintained its strong rate of expansion in April,
helped by higher output and employment, the latest purchasing
managers' index ( PMI )) data showed.
While both input and output price indexes fell from the highs seen in
March, they remained way above the 50 mark as soaring fuel and raw
material prices drove up costs and fed into output prices, a clear
indication that high inflation was here to stay.
Inflation eased to 8.66 per cent in April, but upward revisions to
past readings and the prospect of higher energy prices will keep
pressure on the RBI to raise interest rates in June and maintain its
hawkish stance.
The Reserve Bank of India (RBI), which has been one of the most
aggressive of major central banks in tightening policy, early this
month raised rates by a higher-than-forecast 50 basis points and said
it was willing to sacrifice a bit of growth to tame inflation.
The RBI has raised its policy rate nine times by a total of 250 basis
points since March 2010.
Most economists in a recent poll expect the RBI to raise rates by at
least another 75 basis points in 2011.
Monsoon rains, which are vital for boosting farm production and rural
incomes in the nation of more than 1.2 billion people, have been
forecast to be normal in 2011.
MARKET IMPACT
Bond dealers said a March-quarter GDP growth number of around 8.1-8.3
per cent will have little market impact.
However, they said a number below 8 percent could push yields down by
4 to 5 basis points as the market has been heavily sold in recent
sessions, while a number above 8.5 per cent could push up yields by 2
to 3 basis points.
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of 8.2 per cent in the quarter through March, unchanged from the
previous quarter.
Forecasts ranged from 6.3 per cent to 8.9 per cent.
The economy is expected to have grown 8.5 per cent in fiscal year
2010/11 that ended in March, just below the 8.6 per cent estimated by
the government, and up from 8 per cent a year earlier, the poll
showed.
Forecasts for the full fiscal year growth ranged between 8.0 per cent
and 8.7 per cent.
FACTORS TO WATCH
Industrial output grew an annual 7.3 per cent in March, smashing
forecasts on the back of a revival in capital goods production.
Services sector gained momentum in April, with strong growth in new
business orders, a HSBC survey showed early this month.
Manufacturing sector maintained its strong rate of expansion in April,
helped by higher output and employment, the latest purchasing
managers' index ( PMI )) data showed.
While both input and output price indexes fell from the highs seen in
March, they remained way above the 50 mark as soaring fuel and raw
material prices drove up costs and fed into output prices, a clear
indication that high inflation was here to stay.
Inflation eased to 8.66 per cent in April, but upward revisions to
past readings and the prospect of higher energy prices will keep
pressure on the RBI to raise interest rates in June and maintain its
hawkish stance.
The Reserve Bank of India (RBI), which has been one of the most
aggressive of major central banks in tightening policy, early this
month raised rates by a higher-than-forecast 50 basis points and said
it was willing to sacrifice a bit of growth to tame inflation.
The RBI has raised its policy rate nine times by a total of 250 basis
points since March 2010.
Most economists in a recent poll expect the RBI to raise rates by at
least another 75 basis points in 2011.
Monsoon rains, which are vital for boosting farm production and rural
incomes in the nation of more than 1.2 billion people, have been
forecast to be normal in 2011.
MARKET IMPACT
Bond dealers said a March-quarter GDP growth number of around 8.1-8.3
per cent will have little market impact.
However, they said a number below 8 percent could push yields down by
4 to 5 basis points as the market has been heavily sold in recent
sessions, while a number above 8.5 per cent could push up yields by 2
to 3 basis points.
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