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India's gross domestic product (GDP) growth fell to 5.4% in the July-September quarter, its lowest since Q3 FY23, according to the National Statistics Office (NSO). This marked a sharp decline from 8.1% in the same period last year. Economists had expected 6.5%, but the economy underperformed, with inflationary pressures and weak corporate performance cited as key factors.
Retail food inflation reached 10.87% in October, dampening consumer spending, while headline inflation breached the Reserve Bank of India’s (RBI) comfort range at 6.2%. Private consumption, which accounts for 60% of GDP, remained sluggish due to high borrowing costs and stagnant real wages. Corporate earnings also saw their weakest results in over four years, further impacting investment.