Wall Street Brokerage Goldman Sachs on November 23 expected Indian GDP growth at 9.1 percent by 2022.
After the Indian economy was contracted by sharp 7 percent by 2020, Goldman Sachs set an economy to 8 percent in 2021 and 9.1 percent by 2022.
This previously estimated India’s economic growth to 11.1 percent in the fiscal year until March 31, 2022.
It expects consumption and investment to be the main driver of growth in 2022.
“We hope to consume an important contributor to growth in 2022, because the economy is fully open driven by prominent improvement in viral situations and adequate progress in vaccination,” Goldman Sachs said in a report.
“We also expect government capital expenses to continue, see new signs of the recovery of private companies, and resurrection of housing investment,” he added.
The broker also estimates that the main CPI inflation increased to 5.8 percent by 2022 from 5.2 percent by 2021, which was led by increased core inflation because producers applying input fees to increase with economic reopening.
Santanu Sengupta, Indian economist, Goldman Sachs said, “Given the higher oil prices and the recovery of domestic demand, the current account will open and the deficit in our estimate will increase from 0.9 percent of GDP to 1.5 percent of GDP. “
Broker also expects a cumulative 75 basis points from a repo interest rate increase in 2022.
“India does many things in terms of loosening liquidity, maintaining the liquidity of the banking system in a surplus throughout the Covid period, and it has cut the level of the reverse repo. So, what you see now is a reversal of liquidity loosening. So, the liquidity of the banking system will be increasingly Strict from time to time. And at a time, the polidor policy will be narrowed out that it is the Reverse Reverse Rate level hiked, “said Sengupta.