Consumption hit from second Covid wave seen denting Indian economy

India’s second wave of virus cases will hit the economy by prompting consumers to save rather than spend, unlike last year’s contraction that was driven mainly by supply disruptions, according to a research report.
 

The economic drag from the pandemic in the current quarter will be dominated by demand destruction or deferment of expenditures, said QuantEco Research economist Yuvika Singhal, who downgraded her full-year growth forecast for this year by 150 basis points to 10%.
 

“Expectation of consumption snag looks more palpable now than last year,” Singhal said. “In contrast to a V-shaped recovery, consumption redux could look more U-shaped