India GDP Growth Slows to 4.5% in Q2
India’s Gross Domestic Product (GDP) growth slowed to 4.5% in the second quarter of the fiscal year, down from 5% in the previous quarter. This is the slowest pace of growth in more than six years, as the country’s economy continues to face headwinds from a global slowdown and domestic challenges.
The slowdown in GDP growth was driven by a sharp contraction in manufacturing and construction sectors, which offset a modest uptick in agriculture and services. The manufacturing sector, in particular, has been hit hard by weak demand and a slowdown in investment activity.
The government has taken steps to boost economic growth, including corporate tax cuts and measures to boost consumer spending. However, the impact of these measures is expected to be limited in the short term, as businesses remain cautious in their investment plans.
Meanwhile, the Reserve Bank of India (RBI) kept interest rates unchanged at its recent policy meeting, citing concerns about rising inflation and the need to support economic growth. The decision to hold rates steady was in line with market expectations, as the central bank continues to monitor the impact of its previous rate cuts on the economy.
In Singapore, the Consumer Price Index (CPI) fell by 0.7% in October, marking the fourth consecutive month of deflation in the city-state. The decline in CPI was driven by lower prices for housing, transport, and communication, as well as a moderation in food inflation.
The Monetary Authority of Singapore (MAS) has maintained its neutral monetary policy stance, as the economy continues to face external headwinds and uncertainties. The central bank has highlighted the need for vigilance in monitoring inflation and growth dynamics, and has indicated that it stands ready to adjust its policy settings if necessary.
Overall, the latest economic data from India, South Korea, and Singapore highlight the challenges faced by Asian economies in the current global environment. Policymakers in these countries will need to strike a delicate balance between supporting economic growth and managing inflation risks in the months ahead.