India could be at the top again this year as the world’s fastest growing economy

India could be at the top again this year as the world’s fastest growing economy

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According to India, the gross domestic product according to India will expand by 12.6% during the fiscal year of the country a forecast released Tuesday by the Organization for Economic Co-operation and Development.

If this growth level is realized, it will allow India to regain its status as the fastest growing major economy – and steal the title back from China, which according to the OECD will produce a growth of 7.8% this calendar year after a recession in 2020 would evade.
The Indian economy recorded a 0.4% increase in gross domestic product in the last three months of 2020, ending the recession. For 2020 as a whole, the Indian economy has shrunk by about 7%.

The OECD also on Tuesday announced major improvements to its global outlook, saying that ‘economic prospects have improved significantly over the past few months’ thanks to the implementation of coronavirus vaccines and additional stimulus announcements. The Paris agency also said there were signs that recent controls were not doing as much damage to the economy as earlier attempts.

“This may reflect a closer focus on public health and revenue support measures,” the group said, adding that businesses and consumers are adapting to the restrictions.

The OECD now expects the world economy to grow by 5.6% in 2021, compared to an estimate of just 1.4% in December.

US can grow by 6.5%

The US economy is now expected to expand by 6.5% this year, a major improvement from a previous estimate of 3.3%. The agency pointed to the effects of ‘strong fiscal support’ from President Joe Biden’s $ 1.9 billion stimulus package.

In Europe, where vaccination outside the UK has been slow, the OECD predicts a ‘more gradual recovery’. The 19 countries using the euro are expected to expand production by 3.9%. The British economy, which suffered a bigger blow in 2020 than its European neighbors, will grow by 5.1%.

However, due to the pandemic, the outlook remains very uncertain. The OECD has noted that vaccine campaigns are moving at different speeds around the world, and that there is still a chance of new mutations that resist vaccinations.

It also drew attention to the debate over inflation plagued by markets. Investors are becoming increasingly concerned that a strong recovery could cause prices to rise later this year, forcing central banks to raise interest rates or buy bonds, rather than expected.

The OECD has acknowledged that price pressures are building on some fronts.

” A faster-than-expected recovery in demand, particularly from China, coupled with a shortage of supply, pushed up food and metals prices significantly, and oil prices fell back to their 2019 average level. ‘

But the agency stressed that while central bankers and the labor market are still weak, central bankers must maintain loose monetary policies that have strengthened the recovery, even if inflation exceeds some targets.

“Transient factors that drive headline inflation do not guarantee policy changes,” he said.

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