It has been two years since India became the world’s fastest-growing economy, but for the first time in fifteen months, the country’s growth rate grew at slowest pace on subdued performance of mining, construction and farm sectors, data showed by statistics ministry.
India’s gross domestic product missed expectations as it expanded only by 7.1% in April-June, below economists’ prediction and down from 7.9% growth arte recorded in the preceding quarter.
The recent GDP data was still the fastest compare to other major economies but not enough to create jobs for one million people who joined the workforce every month.
Annual growth in private spending dropped to 6.7% in the latest quarter from a 7% increase while investment lost 3% points from the corresponding period a year ago.
Its consumer price inflation is currently above the Reserve Bank of India’s target band and is sitting at 6.07%.
The benchmark National Stock Exchange index added 8% this year.But on Thursday, the NSE Nifty declined 11.55 points to finish 8 774.65 and the Sensex slumped 28.69 points to close at 28 423.28. Meanwhile, the Indian rupee closed flat against US dollar at 66.96 level.
The US dollar lost ground against basket of currencies on Thursday as US manufacturing data activity surprisingly dropped and investors digested more clues on potential rate hike ahead of job data due on Friday.
US’ index of national factory logged to its first contraction since February as it lost 3.2 percentage points to a reading of 49.4, according to the Institute for Supply Management.
The data prompted the dollar index to fall 0.40% to trade at 95.635, near low session of 95.595.
The greenback went weaker against the Japanese yen and was down 0.09% to close at 103.20. The euro was last up 0.34% at 1.1200.Sterling touched its one month high after jumping 1.17% at 1.3265, supported by the PMI data.