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Moody's analytics cuts India's 2012 growth forecast to 5.5%

Reuters  Mumbai, August 09, 2012
First Published: 11:07 IST(9/8/2012) | Last Updated: 11:27 IST(9/8/2012)

Moody's analytics cut India's growth forecast to 5.5% for this year, citing a lack of government or central bank action despite a broad-based slowdown, as well as a poor monsoon.

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The research unit of ratings agency Moody's Investors Service becomes the latest to cut India's growth forecasts this week.

CLSA and Citigroup cut their outlooks for India to 5.4% and 5.5%, respectively, although for the fiscal year ending in March 2013.

Moody's said the slowdown in India's economy "has been sharper and more broad-based than anticipated and is now deeply entrenched across all sectors of the economy," in a note dated August 8.

Despite the slowing growth, Moody's said both the government and the Reserve Bank of India had provided "little policy response."

Moody's added weaker-than-average rainfalls during the monsoon period would also weigh on India's growth. The research unit also cut its 2013 growth forecast to 6% from 6.2%.


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