‘No change likely in policy rates’

The National Council of Applied Economic Research (NCAER) on Sunday said that the Indian economy remained buoyant at the end of fiscal 202324 and is set to clock 7.6 per cent growth as projected in the CSO’s second advance estimate.

Both the purchasing manager’s index (PMI) for manufacturing and the index on services are maintaining a robust trend, raising optimism about the economy.

Key markers point to the Indian economy remaining buoyant at the end of FY 202324 with the PMI for manufacturing increasing and that onservices maintaining a robust trend, according to NCAER’s monthly economic review for March 2024.

The PMI for manufacturing activity increased to 56.9 in February, reflecting a strong expansionary momentum. Growth in the output of eight key infrastructure sectors rose to a threemonth high of 6.7 per cent in February from 4.1 per cent in January 2024.

OPTIMISTIC OUTLOOK

GST collections, too, remained buoyant, reaching a value of ₹ 1.7 lakh crore in February, registering a yearonyear growth of 12.5 per cent.

Collections of GST eway bills marked an equally impressive yoy growth of 18.9 per cent. Bank credit growth remained strong at 20.5 per cent with robust growth for personal loans, services and agriculture and allied activities.

“These and other markers corroborate the optimistic growth outlook of 7.6 per cent growth rate for FY 202324 as per the second advance estimates,” said NCAER Director General Poonam Gupta.

“Strong growth combined with elevated inflation rates will likely result in a status quo on policy rates when the Monetary Policy Committee meets on April 35,” Gupta added.

Meanwhile, inflationary pressures remained elevated with Consumer Price Index headline inflation at 5.1 per cent in February 2024, primarily due to high food price inflation and despite core inflation declining.