Nomura ups India's 2022 GDP forecast to 7.7%; sees inflation at 5.3%

GDP, according to their estimates, is likely to contract by 4.3 per cent quarter-on-quarter (q-o-q) in Q2, much smaller than during the first wave (-24.7 per cent)

Despite the second wave of Covid infections that brought the economic activity in most cities to a standstill in the past few months, Nomura has raised India’s gross domestic product (GDP) forecast for 2022 by 0.7 percentage points (pp) to 7.7 per cent. That apart, the research and brokerage house has rejigged the forecasts for consumer price inflation (CPI) and current account deficit.

“We raise our 2021 and 2022 current account (CA) deficit forecasts to 1.5 per cent and 1.3 per cent of GDP, respectively (from 1.1 per cent and 0.8 per cent), and CPI inflation to 5 per cent