India may get breather from inflation in 2023, but at cost of real GDP rate: RBI Bulletin

Consumer inflation rate: The projected CPI Inflation Rate is likely to be around 5 per cent in 2023, although, the Real GDP Growth Rate (Y-o-Y) may also go down in the coming year, as per the bulletin released by the Reserve Bank of India (RBI) today.

The Real GDP Growth Rate that stood at 8.1 per cent in 2021 may go down to 6.1 per cent in 2023, as per the bulletin. On October 12, 2022, India's NSO released the CPI data for September 2022 which turned out the be at a 5-month high of 7.41 per cent.

“Consumer activity remains subdued, but it is beginning to recover, while investment is facing the brunt of sanctions and capital outfl ows. Soaring energy prices have helped the external sector hold up relatively well. The economy is expected to contract in both 2022 and 2023 due to the war and sanctions,” stated the bulletin.

The bulletin has analyzed various macroeconomic perspectives of the BRICS nations and the ASEAN countries.  The CPI inflation rate is likely to remain the highest among the BRICS nations at 14.3 per cent for Russia in 2023, due to its war situation.

“Growth in the ASEAN3 economies decelerated in Q2:2022 as the war dampened demand. The manufacturing PMI for these economies in August signalled improvement in business conditions as output and new orders expanded and employment and purchasing activity increased,” added the bulletin.