Forecasts for the much-awaited figure range from a contraction of 7.8 per cent by the Bank of America, to a decline of 12.7 per cent by the National Council of Applied Economic Research (NCAER), with the mean being a 10.3 per cent fall in real GDP.
In the July-September period, the UK had shown a contraction of 9.6 per cent, the steepest decline among a set of 23 economies that have released data to date. China, on the other hand, is the only country to have shown growth at 4.9 per cent during the same period.
Kristalina Georgieva, managing director of the International Monetary Fund, said reinforcing the economic bridge to recovery was the second-most important agenda, after managing the health crisis.
“It is essential to sustain support to businesses and workers until we exit the health crisis — there must be no premature withdrawal,” she wrote in her note.
Besides the UK, Spain was a badly-affected economy and featured among the worst performing economies in the July-September quarter. Emerging market Mexico was another country to join the likes of the UK, Spain, and India.
Recent high-frequency economic indicators such as Goods and Services Tax collections and e-way bills generation have shown improvement beyond expectations, taming the possible decline in India’s GDP growth, according to experts.
However, global demand remains weak and has been pushed own further by repeated waves of infections across Europe and the US.
“Renewed lockdowns in some advanced economies may suppress the level of non-oil exports in the ongoing month,” ICRA had written in a November 13 note.
Markets across the world have been responding to the good news
regarding vaccine development quite vigorously, but also have shown volatility.
“Positive vaccine news
raises hopes but still a ways to go. As of Q3 of 2020 (calendar year), GDP is yet to return to pre-pandemic levels with exception of China,” Gita Gopinath, chief economist at the IMF, tweeted on November 17.
A State Bank of India report stated that most economies showed significant improvement in Q2FY21, and put India’s estimate at 10.7 per cent contraction.
Though many economists have revised the Q2 estimate upwards, a rising spate of Covid-19 infections may have a deleterious impact on the Q2 performance.