The worst seems to be over for the Indian economy’s growth trajectory, a German brokerage said on Thursday.GDP growth, which had slipped to a seven-quarter-low of 5.4% in the September quarter leading to a lot of concerns over the economy’s strength, is likely to rise to 6.2% in the December quarter, the report by Deutsche Bank said.”We think the worst is over as far as India’s growth trajectory is concerned but, even with the improvement of momentum, overall GDP growth is likely to remain below the potential growth rate of 7% in FY26,” the bank’s analysts said.
In the report, the analysts also said that we have to be cautious about the forecasts as there can also be a revision in previous years’ data.The brokerage added that its leading indicator derived from 65 high-frequency indicators is also pointing towards a 6.2% growth.The Reserve Bank is likely to deliver another rate cut of 25 basis points at the upcoming review of the monetary policy in April to help growth.Minutes of the last policy reveal that all the members on the six-member monetary policy panel feel that rates remained at restrictive levels, it said. After the April rate cut, RBI will focus more on the liquidity measures to ensure transmission of the 0.50% repo rate cut to the real economy, it said, adding that more cuts are unlikely in the current cycle.The central bank is already cognizant about the liquidity needs, and the recent USD 10 billion swap announcement is “encouraging”, it said.
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