When India’s Gross Domestic Product growth numbers came in last week for October-December 2019 – what the financial papers would call “Q3-F...
When India’s Gross Domestic Product growth numbers came in last week for October-December 2019 – what the financial papers would call “Q3-FY‘20” – newspapers seemed confused. One carried the headline that India’s GDP growth had jumped up to 4.7%. Another said India’s economy had slowed down to 4.7%. Which was right?
Some observers put the difference down to expected biases, but for once the confusion may have been understandable.
Here is what happened:
At the start of the day, per the official record, India had grown at 4.5% in the second quarter, from July to September. If, as most economists expected, the figure was 4.7% for the third quarter, then it would have meant the downward slide in growth numbers had ended. 4.7% may be only marginally better than 4.5%, but it is a bigger number.
So when the government announced that the third quarter growth was indeed 4.7%, many thought it was proof that the economy had bottomed out and growth numbers would start moving up.
Except the government also changed the previous quarter’s number, from 4.5% up to 5.1%.
As a result, what was before a jump from 4.5% to 4.7% had suddenly become a drop from 5.1% to 4.7%.
As Ira Dugal put it...
