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Updated December 30th, 2023 at 12:23 IST

Growth momentum gained in Q2 likely to be sustained in Q3 of FY24: Finance Ministry

As per the report, the continued expansion in PMI employment sub-indices Naukri Job Speak Index signals a moderation in hiring activity.

Business Desk
Following the epidemic, India's economy has recovered strongly to become a major engine of global growth. Following a spike in FY2022/23, headline inflation has reduced on average, though it remains erratic.
India's growth story | Image:Pexels
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The growth momentum gained in the second quarter of FY24 will likely be sustained in the third quarter of FY24, officials from the Department of Economic Affairs said in the half-yearly economic review report on Friday.

“The better-than-expected growth in Q2 of FY24 and the emergence of India as the fastest-growing major economy in H1 of FY24 have improved the growth prospects and prompted various domestic and international agencies to upgrade GDP growth projections for FY24,” the report said.

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As per the report, the continued expansion in PMI employment sub-indices Naukri Job Speak Index signals a moderation in hiring activity.

In October and November, PMI manufacturing and services remained in the expansionary zone. IIP print in October 2023 along with the Index of Eight Core Industries highlights sustained growth in manufacturing activity.

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“Sentiments in the services sector remain upbeat, driven, among others, by an upswing in the tourism cum hotel industry induced by leisure travel, business travel, and social events,” the report added further.

On the consumption front, the officials from the Finance Ministry believe that growth in consumption demand is expected to be sustained. “Urban demand conditions remain resilient, with higher growth in auto sales, fuel consumption, and UPI transactions. Rural demand is also rising, as reflected in robust growth in two and three-wheeler sales,” the report highlighted.

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On the inflation front, Finance Ministry officials believe that the headline inflation outlook is on a declining trend, notwithstanding temporary disruptions from food prices. RBI has projected inflation to average 5.4 per cent in FY24.

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Published December 30th, 2023 at 12:11 IST

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