Motilal Oswal: India Enters Its First Technical Recession; GDP Could Further Decline In Q3 FY21
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Motilal Oswal Report
Real gross domestic product declined 7.5% YoY in Q2 FY21 (or Q3 CY20), worse than our expectation, but better than the market consensus.
The contraction in nominal GDP was 4% as the GDP deflator grew 3.8% YoY, versus 1.8% in Q1 FY21.
Personal consumption expenditure declined 11.3% YoY in Q2 FY21 – in line with our forecast, gross investments reported a stronger-than-expected recovery, while government consumption expenditure posted its highest-ever decline on record.
Net exports continued to add positively to real GDP growth in Q2 FY21 as imports contracted sharply. On the other hand, the fall in real exports was only marginal.
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