TIL Desk/Business/Mumbai/ The second quarter GDP growth may further lower down to 4.2 per cent on low automobile sales, deceleration in air traffic movements, flattening of core sector growth and declining investment in construction and infrastructure, and the growth forecast for FY20 has now come down to 5 per cent from 6.1 per cent earlier, an SBI report said.
State Bank of India (SBI) joins all other global agencies — the ADB, World Bank, OECD, RBI and the IMF — in downgrading India’s FY20 growth rates. “Based on our composite leading indicator that suggests the GDP growth to slow down further from 5.0 per cent in Q1 of FY20 to 4.2 per cent on account of low automobile sales, deceleration in air traffic movements, flattening of core sector growth and declining investment in construction and infrastructure”, the bank said in a report.
Country’s GDP was already at the 6-year lowest of 5 per cent in Q1. “Our 33 high frequency leading indicators reveal an acceleration rate which was 65 per cent in Q1 FY19 declined sharply to 27 per cent in Q2 FY20. Besides that, Skymet also reported that the country as a whole received 110 per cent of the long period average (LPA) of 89 cm of rainfall during the four-month-long southwest monsoon period, making it to the above normal category, SBI said.
