India GDP Growth Slows More than Anticipated


The Indian economy advanced 7.1 percent year-on-year in the third quarter of 2018, well below 8.2 percent in the previous period and market expectations of 7.4 percent. It is the lowest growth rate in three quarters, mainly due to a slowdown in consumer spending amid high oil prices and a weaker rupee. Also, inventories, financial services, manufacturing and the farm sector rose less.

Household spending (7 percent compared to 8.6 percent in the previous period) and inventories (3.8 percent compared to 8.6 percent) slowed. On the other hand, government spending (12.7 percent compared to 7.6 percent), gross fixed capital formation (12.5 percent compared to 10 percent), exports (13.4 percent compared to 12.7 percent) and imports (25.6 percent compared to 12.5 percent) rose faster. Household spending accounted for 54.5 percent of the GDP (54.9 percent in Q2); gross fixed capital formation for 32.3 percent (31.6 percent in Q2); public expenditure for 12.4 percent (11.8 percent in Q2); and changes in stocks for 0.7 percent, the same as in Q2. Exports accounted for 21.8 percent (21.4 percent in Q2) while imports subtracted 26.6 percent (-24.7 percent in Q2). 

Gross Value Added, that is, GDP excluding taxes expanded 6.9 percent, below 8 percent in the previous period. A slowdown was seen in financial, real estate and professional services (6.3 percent compared to 6.5 percent); manufacturing (7.4 percent compared to 13.5 percent in the previous period); agriculture, forestry and fishing (3.8 percent compared to 5.3 percent); and construction (7.8 percent compared to 8.7 percent); and mining shrank (-2.4 percent compared to 0.1 percent). On the other side, faster increases were seen for trade, hotel, transport, communication and services related to broadcasting (6.8 percent compared to 6.7 percent); and public administration and defence (10.9 percent compared to 9.9 percent).

India GDP Growth Slows More than Anticipated


Joana Taborda | joana.taborda@tradingeconomics.com
11/30/2018 1:39:34 PM