UBS revises GDP forecast to 9.5% for FY22, up from 8.9%

Swiss brokerage UBS Securities have revised upwards its growth forecast for India in the current fiscal Fy22 to 9.5 percent from 8.9 percent as predicted in September.

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New Delhi:  Citing faster-than-expected recovery, rising consumer confidence, and the resultant spending spike, Swiss brokerage UBS Securities have revised upwards its growth forecast for India in the current fiscal Fy22 to 9.5 percent from 8.9 percent as predicted in September.

The Body also sees the economy running at 7.7 percent growth in FY23 but slowing to 6 percent in FY24, as it expects the benefit of the low-interest rate and other govt. schemes to end by the end of FY23. The Reserve Bank also forecasted a 9.5 percent GDP growth in this fiscal while the average projection ranges from 8.5 to 10 percent. The government projection is around 10 percent.

In its, September report, UBS said, real GDP declined by 12.4 percent in the June quarter against the -26 percent in the same period last year. Hence, we maintain the base case estimate of GDP growth at 8.9 percent in FY22 compared to the consensus of 9.2 percent against the deeper 7.3 percent contraction in FY21.
The GDP grew at 20.4% in Q1 of FY22.

Tanvee Gupta Jain, the chief economist at UBS Securities India said, “The economy is bouncing back on progressive reopening, and the recovery from the second wave has been more pronounced than what we anticipated, Therefore UBS has predicted a higher-than-expected GDP run this fiscal.”

Without giving an exact number, she said the economy will grow by 9-10 percent in Q3 and 6-6.5 percent in Q4 this fiscal, leading to higher overall year Growth. 

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