How to read today’s GDP numbers?

Rural wages, which are a bellwether for blue-collar employment, had not recovered to pre-pandemic levels until August, the latest period for which data is available.

The National Statistical Office (NSO) will release GDP data for the July-September quarter of the current fiscal year today. In its October meeting, the Reserve Bank of India’s Monetary Policy Committee projected a GDP growth of 7.9% for this period. A Bloomberg forecast of 14 economists has projected the number to be 8.1%. The headline number aside, how should one read today’s GDP numbers? Here are five charts that answer this question.

India’s GDP fell by a record 7.3% in 2020-21. This was largely on account of the massive contraction in the first half (April-September) in 2020-21(MINT_PRINT)

Growth by sectors will be far more interesting

High frequency indicators suggest the formal economy did well in the September quarter

These numbers might not tell the informal sector story

Demand for rural jobs guarantee work has not declined despite a sharp recovery in formal sector high frequency indicators. Rural wages, which are a bellwether for blue-collar employment, had not recovered to pre-pandemic levels until August, the latest period for which data is available. Informal sector numbers take time to show in the GDP statistics, and today’s numbers must be read with this caveat in mind.