Economy resilient, biz confidence improves in June: NCAER Report

New Delhi: High-frequency gauges suggest the economy remains resilient and the Business Confidence Index improved in the June quarter from the previous three months, the National Council of Applied Economic Research (NCAER) said in its July economic review.The NCAER-NSE Business Confidence Index increased to 149.8 in the June quarter, up from 138.2 in the January-March period, “indicating improvement in business sentiments”, it said.

The full Budget for FY25, NCAER said, stressed fiscal prudence and capex. Nominal GDP growth projection is retained at the interim budget level of 10.5% for FY25, while the fiscal deficit is estimated at 4.9% of GDP, down from the interim budget level of 5.1%.

The Purchasing Managers’ Index for manufacturing and services, NACER said, remained in expansionary momentum; industrial production rose; Goods and Services Tax collections remained buoyant. The total outstanding credit of banks rose 20.8% on year in May 2024, NCAER said in the review.

However, it also pointed at a drop in core infrastructure sector growth in May to 6.3% from 6.7% in April and the rise in June retail inflation to 5.08% from 4.80% in the previous month.

Employment indicators showed mixed trends, with Naukri JobSpeak Index moderating in June from a year before, while sectors like travel and hospitality, banking, and retail stepped up hiring. The number of net new subscribers under the Employees’ Provident Fund Organisation rose from a year earlier, while demand under the Mahatma Gandhi National Rural Employment Guarantee Act eased in June from a year earlier.