Accordingly, while projecting the inflation to moderate to 7 percent by March 2012, the growth projection was revised downwards from 8 percent to 7.6 percent in the October 2011 monetary policy statement. That downward revision was consistent with the expected impact of past monetary policy actions as also the impact of deteriorating global economic conditions on domestic growth.
The second quarter GDP growth for 2011–12 at 6.9 percent has magnified the growth concerns, given the continuous flow of negative news and assessments about the outlook in the advanced economies. One has to wait till December 16th to see how these recent developments are taken into the RBI’s assessment of the domestic macroeconomic outlook.