India GDP may've grown 5.5%: Moody's
said and added that the corporate sector remains the weakest pocket of the economy.
"The corporate sector remains the weakest pocket of the economy, with sentiment weighed down by external weakness and, more important, the Congress-led government's cack-handed management and policy making in its second term," it added.
Going forward, the third quarter GDP forecast is likely to be slightly better than the June quarter driven by industrial production, which was a little better in the three months to September along with some slightly better trade figures.
"Better industrial production figure, along with some slightly better trade figures, lifts our third quarter GDP forecast above that from the June quarter, but not by much, and anything with a '5' at the front of it must be considered disappointing," it added.
Moody's further said that the initial bounce in investor sentiment following the announcement of economic reforms has faded, and the reality of India's deep-seated structural problems has begun to set in.
In the two months to October the Sensex rose 15 per cent and the rupee up 8 per cent against the US dollar. But the Sensex has dipped in recent weeks, while the currency has given back most of the recent gains.
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