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Post-demonetisation, rating agency Crisil has ‘sliced’100 basis points from the country’s GDP growth this fiscal to 6.9 per cent from its earlier estimate of 7.9 per cent.
“That translates into a GDP growth of 6.6 per cent for the second half, compared with 7.2 per cent in the first half,” a Crisil report said.
“The jolt to demand will also pull inflation down. We now expect the Consumer Price Index (CPI)-based inflation to print lower at 4.7 per cent compared with our earlier forecast of 5 per cent. So while the pain of demonetisation will be frontloaded, the benefits will be felt over a period of time,” the report said.
“Any disruption in the flow of money, verily the economy’s lifeblood, impacts business cycles quickly. And more so if it is of an order of magnitude,”Crisil added.
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