RBI Upwards GDP Growth Forecast: Economic Affairs Secretary Ajay Seth

New Delhi, Dec 8 (PTI) The upward revision in GDP growth forecast by the RBI is "very well placed" with high frequency indicators in October and November showing good momentum, Economic Affairs Secretary Ajay Seth said on Friday.

"It is quite obvious... growth that India has achieved in the first half and then in two months (October, November) where the high frequency indicators are showing a good momentum... this upward revision is very well placed," he told reporters.

The RBI in its bi-monthly policy review revised upwards growth projection for the current fiscal to 7 per cent, from 6.5 per cent earlier.

The Indian economy grew 7.8 per cent and 7.6 per cent in the June and September quarters, taking the first half growth to 7.7 per cent.

Seth said there is stickiness in inflation and that is keeping inflation away from the targeted 4 per cent level.

"Some variation on a month-on-month basis can happen which can be on account of either base effect or any commodity prices going up on a temporary basis.

"Whatever supply-side measures are to be taken in terms of food products they are being taken as and when necessary," he said.

Seth further said the risk of spillover of geopolitical tension has been contained and oil prices continue to be subdued.

"I broadly agree with the RBI assessment (on inflation)," he said.

In its bi-monthly policy statement, the RBI retained retail inflation projection for the current fiscal at 5.4 per cent, but said that inflation may see an uptick in November and December due to pressure on food prices.

"Going ahead, inflation outlook would be considerably influenced by uncertain food prices. High frequency food price indicators point to an increase in prices of key vegetables which may push CPI inflation higher in the near-term," RBI Governor Shaktikanta Das said.

Retail or consumer price index-based CPI inflation moderated to 4.9 per cent in October from 7.4 per cent in July.

CPI inflation is projected at 5.4 per cent for 2023-24, with Q3 at 5.6 per cent and Q4 at 5.2 per cent, the RBI monetary policy statement said.

The inflation for June quarter of 2024-25, is projected at 5.2 per cent; September at 4 per cent; and December quarter at 4.7 per cent.