The government s fiscal deficit is expected to remain in line with the estimated ₹17.9 trillion for the full fiscal year, as tax revenue grew and spending and subsidy outgo were in line with estimates.
IDFC FIRST Bank’s Economist Gaura Sengupta said the deflator, with a higher weight of WPI, was favourable for manufacturing than the services sector, which has a higher weight of Consumer Price Index (CPI) inflation.
Services sector is seen contributing the maximum share to the overall growth in the second quarter, even as the sector along with agriculture may see a slight moderation.
Inflationary pressure on the economy is mounting because of erratic and inadequate rainfall in the kharif season and uncertainty on rains surrounding the ongoing rabi season, which could impact growth