BENGALURU (Reuters) - India's economic growth surged to a more than two-year high of 8.2 percent in the three months ended June from a year earlier, powered by a strong performance in manufacturing and consumer spending.
The $2.6 trillion economy, the world's sixth largest, had an annual growth of 5.6 percent in the April-June quarter of 2017.
The Reuters poll median forecast was 7.6 percent annual growth, compared with the 13-quarter low of 5.6 percent for a year earlier, when many companies cut production before the launch of a nation-wide sales tax.Forecasts ranged between 7 and 8 percent. The poll results suggest domestic demand was strong, driven primarily by manufacturing activity that remained solid despite elevated oil prices and a weakening Indian rupee.
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SHASHANK MENDIRATTA, INDIA ECONOMIST, ANZ BANK, BANGALORE
"The numbers are pretty solid and mostly driven by public investment and higher consumption, especially, in the rural-end with this being a pre-election year.
"This is probably the best GDP trend we have seen in the first half helped by a favourable base. Going ahead, I expect the growth rate to be moderate as private investment is unlikely to grow at a faster rate due to stressed assets. Private consumption grew at its fastest rate since demonetisation.
"The rupee weakening would mean more to inflation numbers than growth. We expect the Reserve Bank of India to hike rates in the March-quarter next year with no changes this year."
(Reporting By Arnab Paul in Bengaluru, Editing by Sherry Jacob-Phillips)
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