India: Q3 GDP growth improves, but economic issues remain - TDS

India’s economic growth accelerated to 6.3% Y/Y in Q3 2017, with fixed investment and a reduction of the drag-down effect of net exports the main contributors, points out the research team at TDS.

Key Quotes

“Household consumption, however, decelerated again in Q3.”

“Gold purchases have been the silent booster to GDP numbers, without which growth would have been around 5%. Going forward, we expect the effects of demonetisation and the introduction of the GST to fade away completely, helping a gradual economic improvement.”

“That said, growth remains relatively weak and future prospects do not offer great hopes. The RBI may decide to become more accommodative, but not before 2018. At the RBI meeting next week, we expect the MPC to hold.”