At 7.6%YoY, India’s Q2 FY24 GDP growth data offered us a ‘Just looking like a wow’ moment.
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India’s Q2 FY24 GDP growth data not only defied street expectations by a wide margin buty also defied expectations of a slowdown in growth in Q2 as well as H1 FY24 – for a second consecutive quarter.
Q2 FY24 GDP print compels us to revise our FY24 growth forecast higher by 30 bps to 6.5%. Looking ahead, despite festivities led buoyancy in economic activity at the start of Q3, we expect momentum in economic activity to wane in H2 FY24 vs. H1 amidst downside pressures from slowing external demand, urban consumption responding to higher rates and recent RBI measures to rein uncollateralised lending, government capex giving up some momentum in H2 to meet budgeted target, downside to Kharif output, concerns over El Niño in 2024 weighing on Rabi prospects and the waning of support from commodity cycle.