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Q2 GDP growth at over six-year low: Here's what top brokerages have to say

Updated : 2019-12-02 08:08:15

The Gross Domestic Product (GDP) growth for the second quarter (July-September) of the financial year 2019-20 dropped to 4.5 percent, the weakest pace in more than six years, due to weak consumer demand, slowing factory activities and negative impacts of the prolonged monsoon, according to data released by the government on Friday. The economy had expanded at 5 percent in the first quarter of 2019-20, its slowest annual pace since 2013. Here's what brokerages have to say about the Q2 GDP data:

<strong>Nomura on Q2 GDP:</strong> Q2 GDP growth suggests a sharp bend isn't around the corner, Nomura said in its report. It added that private demand weakened, but was cushioned by higher public spending. Nomura expects growth to remain subdued at 4.7 percent YoY in Q4 and to an average of 4.9 percent in FY20.
Nomura on Q2 GDP: Q2 GDP growth suggests a sharp bend isn't around the corner, Nomura said in its report. It added that private demand weakened, but was cushioned by higher public spending. Nomura expects growth to remain subdued at 4.7 percent YoY in Q4 and to an average of 4.9 percent in FY20.
<strong>HSBC on Q2 GDP:</strong> The brokerage forecasts GDP to grow 4.9 percent in FY20 and 5.9 percent in FY21. It also expects a 25 bps repo rate cut in the December policy meet.
HSBC on Q2 GDP: The brokerage forecasts GDP to grow 4.9 percent in FY20 and 5.9 percent in FY21. It also expects a 25 bps repo rate cut in the December policy meet.
<strong>Kotak Institutional Equities on Q2 GDP:</strong> Economic activity further deteriorated in Q2 owing to a slump in investment, said the brokerage. It added that it further revises the FY20 GDP growth forecast by 30 bps to 4.7 percent.
Kotak Institutional Equities on Q2 GDP: Economic activity further deteriorated in Q2 owing to a slump in investment, said the brokerage. It added that it further revises the FY20 GDP growth forecast by 30 bps to 4.7 percent.
<strong>Deutsche Bank on Q2 GDP:</strong> While a weak GDP print was expected, the slowdown in nominal GDP was striking, the brokerage noted. It added that as per its forecast, real GDP growth will likely average about 5.2 percent in H2.
Deutsche Bank on Q2 GDP: While a weak GDP print was expected, the slowdown in nominal GDP was striking, the brokerage noted. It added that as per its forecast, real GDP growth will likely average about 5.2 percent in H2.
<strong>Credit Suisse India Strategy</strong>: Central spending growth must slow to 1 percent if deficit targets are to be met, stated Credit Suisse. It also noted that FY20 growth exceeding 5 percent now appears unlikely.
Credit Suisse India Strategy: Central spending growth must slow to 1 percent if deficit targets are to be met, stated Credit Suisse. It also noted that FY20 growth exceeding 5 percent now appears unlikely.
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