Current Affairs - Economy

The fiscal deficit is the difference between the government's revenue and expenditure. It is expressed as a percentage of GDP. India's fiscal deficit target for FY24 is 5.9% of GDP. However, the fiscal deficit for the April-August period in FY24 stood at Rs 6.42 trillion, which is 36% of the full-year target. This indicates that the government is on track to exceed its fiscal deficit target for the year.

The RBI has not announced any interest rate cuts in its recent monetary policy announcement. On the contrary, RBI Governor Shaktikanta Das emphasized the central bank’s commitment to achieving a durable 4% inflation target while keeping benchmark interest rates unchanged for the fourth consecutive meeting.

The Purchasing Managers' Index (PMI) for the services sector in India reached 61 in September 2023, according to a survey-based index by S&P Global Market Intelligence. The PMI is a measure of business activity in the services sector. A reading above 50 indicates expansion, while a reading below 50 indicates contraction.

UNCTAD has revised its economic growth forecast for India in 2023 upward to 6.6% from the earlier projection of 6%. However, the report also anticipates a slowdown in India's growth to 6.2% in 2024. UNCTAD's revised forecast is based on India's strong domestic demand and robust corporate earnings. However, the report also highlights some downside risks to India's growth, including the ongoing war in Ukraine, rising inflation, and monetary tightening by the US Federal Reserve.

The World Bank has revised its retail inflation forecast for India for FY24 to 5.9%, up from the earlier estimate of 5.2%. This upward revision is attributed to certain factors which caused a sharp increase in food prices in July 2023. It is important to note that this is just a forecast and the actual inflation rate may vary.