Experts predict economic slowdown at 4.3-4.6% with services outpacing manufacturing again

New Delhi, Feb 27 (KNN) Market experts are of the opinion that India’s economy will grow at a slower rate of 4.3-4.6 per cent in the quarter as against to 6.3 per cent in Q2FY23, reported Money Control.

These forecasts come right ahead of the release of the macro-economic data for the third quarter of FY2023 on February 28 by government of India.  

The services sector is expected to beat manufacturing yet again like the previous quarter as many segments are experiencing a slowdown in global demand.

Experts say that economic activity was uneven in Q3, in spite of robust demand for contact-intensive services, and upbeat festive season sentiment.

Trends in government spending were disparate, with an expansion in revenue spending, along with a base effect-led contraction in capital spending.

Due to the higher base of the previous quarters, most experts expect the growth rate to be sub-five percent, as the economy moved back to normality post Covid.

Rahul Bajoria, MD & Senior Regional Economist, APAC, Barclays Investment Bank, expects India’s Q3FY23 GDP to rise 5 percent year-on-year (YoY), slowing from 6.3 percent in Q2FY23.

“We think a resilient domestic economy and continued increase in services activity will prop up India’s growth, with only a modest drag coming from manufacturing and exports due to external headwinds,” Bajoria said in his note.

Anmol Das, Head of Research, Teji Mandi, said that, “high inflation and reduced per capita spending post-pandemic tightens our Q3FY23 GDP expectations, despite the festive season. We expect the GDP growth rate to be around 4.5 percent.’’

Suvodeep Rakshit, Senior Economist, Kotak Institutional Equities, pegs the growth for the quarter at 4.3 percent, the lowest among the experts that Moneycontrol spoke to.  (KNN Bureau)