GDP

GDP

• The Indian economy grew by 5.3% in Q2FY15 taking H1 GDP growth to 5.5%. 
• Contrary to expectations, agriculture growth was strong at 3.2% in Q2. 
• A pick-up in growth in construction, and community, social and personal services pushed up services growth to 7.1% in Q2. 
• Relative to Q1, industrial GDP growth however, nearly halved to 2.2% in Q2, led by weakness in the manufacturing sector. Although private spending growth climbed up from its lows, it failed to push demand in consumer-oriented sectors such as automobiles and consumer durables. 
• Exports too performed dismally in Q2, in part due to a high base and also possibly due to slowing demand from Europe. 
• The capital goods sector, similarly, has continued to face the wrath of sluggish investment (zero y-o-y growth in Q2). 
• Early indicators for Q3 too are not yet quite upbeat, leading us to reaffirm our 5.5% GDP growth forecast for FY15.