After witnessing a holiday led sequential slowdown last week, QuantEco’s DART (Daily Activity and Recovery Tracker) Index bounced back in the week ending 27th Mar-22 to attain a record high once again. On a WoW basis, the index rose by 3.5% to a level of 130.3 compared to a contraction of 1.9% in the week prior.

The DART index has closed the fiscal year at a post pandemic high, surpassing the baseline of 100 by more than 30%. The current level of the index along with the broad-based recovery at a granular level reinforces the persistence and durability of growth despite the Omicron wave and the outbreak of Russia-Ukraine war more recently. From a technical perspective, we would like to flag off likely revisions to last four DART readings, on account of E-way bills data which has not been updated since the week ending 27th Feb-22. Our bias for adjustment however lies to the upside given year-end seasonality getting accentuated for generation of E-way bills.

Heading into FY23, we do acknowledge mounting headwinds to growth and upside risks to inflation. After remaining unchanged for nearly 4 months, retail price of petrol and diesel has been revised up by a cumulative ~Rs 5 per litre each in the last one week. Taking on board the impact of higher commodity prices, we estimate FY23 CPI inflation in the range of 6.1-6.3% now (vs. 5.3% earlier). On the other hand, while we hold on to our FY23 GDP growth estimate at 7.5%, downside risks to both private consumption and investment have gathered pace (along with exports amidst slowing global growth). The extent of downward revision remains dependent on the severity and longevity of the ongoing geopolitical concerns. Globally, the surge in COVID infections led by Asia and Europe is an added risk that is on watch.