The central bank’s six-member Monetary Policy Committee (MPC) in its bi-monthly Monetary Policy Statement, noted that the April-June GDP growth is seen at 7.1 percent, and the July-September GDP growth is seen at 7.4 percent.
Further, the real GDP growth in FY19 is seen at 7.4 percent as against 6.6 percent in FY18.
The growth will accelerate from 7.3-7.4 per cent in first half of 2018-19 to 7.3-7.6 per cent in the second of half of the current fiscal, said the first bi-monthly monetary policy statement for 2018-19.
It stated that on the whole, GDP growth is projected to strengthen from 6.6 per cent in 2017-18 to 7.4 per cent in 2018-19 in the range of 7.3-7.4 per cent in H1 and 7.3-7.6 per cent in H2 with risks evenly balanced.
Private consumption growth, whose contribution to GDP growth in FY18 was 68%, moderated in the second half. Goods and Services Tax (GST) implementation had an adverse, although transient, effect on urban consumption through loss of output and employment in the labor-intensive unorganized sector.
Government expenditure provided sustained support to aggregate demand with a pick-up in pace in the second half. Gross fixed capital formation turned around in Q2 and accelerated in the second half, primarily in Q3, reflecting the first signs of a sustained expansion in capital goods production and a modest revival of construction activity.
CPI inflation for April to September is seen at 4.7 – 5.1 percent , and 4.4 percent for October to March.