Suvodeep Rakshit, Senior Economist, Kotak Institutional Equities
"2QFY22 real GDP growth at 8.4% was in line with consensus expectations. A large part of the growth upside was driven by the public administration, education, health, etc. segment which saw sharp increase in momentum as well as a favorable base effect. Overall, the sharp uptick from the second wave was visible across all segments. Investment growth remained strong even when compared to 2QFY20 (pre-Covid) levels. Growth should remain fairly well supported in 3QFY22 too on account of festive season and opening up of services sector too. Growth remains well on track for a full year growth of around 9.5%. The growth numbers will unlikely play a differentiating factor for the RBI's policy with its own estimate being at 7.9%. With a new Covid variant starting to spread globally and uncertainty on its impact on the economic scenario, the RBI would possibly wait for some more clarity before moving decisively on the rates. We maintain our call for a reverse repo rate hike in February with the December meeting remaining a close call."