We revise our FY22 GDP growth estimate lower by 150 bps to 10.0% basis our assessment of the.....
Download ReportCOVID delays and dilutes FY22 growth recovery
We revise our FY22 GDP growth estimate lower by 150 bps to 10.0% basis our assessment of the impact of the current wave of COVID infections that is yet to peak. The growth setback in Q1 FY22 will be dominated more by demand deferment as opposed to Q1 FY21 which began with a supply disruption of epic proportion. This gives us the confidence that as the ongoing wave ebbs and vaccinations pick up pace, sequential growth recovery could look better Q3 FY22 onwards. While we expect inflation to provide comfort at 5.0% for the current fiscal year, the imputed impact of the second wave of COVID on growth will mean that the RBI remains accommodative for longer than anticipated earlier. We now expect no hike in repo rate in FY22.