India grows beyond analysts forecasts
Saturday, 8 September 2007
The Indian economy has seen above expectation growth, particularly in manufacturing and services, according to figures released by the Indian Ministry of Statistics recently.
The Gross Domestic Product (GDP) had increased over the second quarter on the year before, rising by a staggering 9.3 per cent, and continuing the growth the economy has enjoyed over the last few years.
Analysts had predicted the rate of growth to fall to 8.9 per cent over the second quarter from 9.1 per cent the quarter before, reflecting the significance of today's results as an indicator of India's continuing success.
Meanwhile, the Reserve Bank of India had predicted growth over year to come in well below today's figures at just 8.5 per cent. Having raised interest rates five times over the last year, the bank was hoping to notice a marked slowdown in the rate of growth.
With the rise of outsourcing in the services sector, the Indian economy has enjoyed strong growth over the last few years enabling the economy to develop and living standards to increase.
However, with growth seemingly remaining consistent, analysts are forecasting yet another interest rate rise when the Bank of India meet next, in order to calm the rate of inflation and halt the rampant growth that could lead to overheating.
Over the last few months, the Reserve Bank of India have been engaged in widespread anti-inflation measures to keep the economy on track. With several successive interest rates and several CCR increases in the last year, the Bank have been trying to lessen the inflationary pressure within the economy, which should also hinder growth at the same time.
However it would appear that today's news would signfy the lack of success of the central bank in maintaining growth with current policy, and could indicate a change in interests rates is on the way.
......................................
Asia Economic Watch
The Gross Domestic Product (GDP) had increased over the second quarter on the year before, rising by a staggering 9.3 per cent, and continuing the growth the economy has enjoyed over the last few years.
Analysts had predicted the rate of growth to fall to 8.9 per cent over the second quarter from 9.1 per cent the quarter before, reflecting the significance of today's results as an indicator of India's continuing success.
Meanwhile, the Reserve Bank of India had predicted growth over year to come in well below today's figures at just 8.5 per cent. Having raised interest rates five times over the last year, the bank was hoping to notice a marked slowdown in the rate of growth.
With the rise of outsourcing in the services sector, the Indian economy has enjoyed strong growth over the last few years enabling the economy to develop and living standards to increase.
However, with growth seemingly remaining consistent, analysts are forecasting yet another interest rate rise when the Bank of India meet next, in order to calm the rate of inflation and halt the rampant growth that could lead to overheating.
Over the last few months, the Reserve Bank of India have been engaged in widespread anti-inflation measures to keep the economy on track. With several successive interest rates and several CCR increases in the last year, the Bank have been trying to lessen the inflationary pressure within the economy, which should also hinder growth at the same time.
However it would appear that today's news would signfy the lack of success of the central bank in maintaining growth with current policy, and could indicate a change in interests rates is on the way.
......................................
Asia Economic Watch