Rating agency Icra on Wednesday said while there is some evidence of the economic recovery becoming broad-based in the third quarter of fiscal 2022, it is yet to attain the durability being sought by the Monetary Policy Committee (MPC) as a precursor to policy transmission.
The agency expects the real GDP to expand 6-6.5 per cent year-on-year in the third quarter of FY2022 (+8.4 per cent in Q2 FY2022).
It also sees the RBI maintaining the status quo in the upcoming monetary policy review to be held in February.
Its chief economist Aditi Nayar said economic activity rebounded in December 2021, even as many sectors continued to trail the performance recorded in October 2021.
Encouragingly, the quarterly data suggests a modest broad-basing of the recovery in Q3 FY2022, relative to Q2 FY2022, when compared to respective pre-COVID-19 volumes.
"However, the onset of the third wave of COVID-19 has triggered state-wise restrictions, which have expectedly interrupted the momentum in the ongoing month, reiterating that the recovery is yet to attain durability," Nayar said in a report released on Wednesday.