Q2FY20 investment growth at 19-quarter low despite govt's stimulus measures

It was govt spending that held up growth in the quarter, while growth in private final consumption expenditure, a proxy of demand, also improved

Growth in gross fixed capital formation, a proxy for investment, fell to a 19-quarter low in the July-September period of the fiscal year 2019-20 (Q2FY20), despite the government announcing stimulus measures in the quarter.

The gross fixed capital formation (GFCF) grew by 1 per cent in Q2FY20, compared to a 4.04 per cent growth in the previous quarter, showed data released by the Central Statistics Office on Friday.

The share of GFCF in overall gross domestic product (GDP) shrank to 27.8 per cent during the quarter, against 29.7 per cent in the previous quarter — the lowest since Q4FY17.

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