Mumbai: India's economy probably shrank for a second straight quarter, according to a team of economists including Michael Patra, the central bank's deputy governor in charge of monetary policy, pushing the country into an unprecedented recession.
Gross domestic product contracted 8.6 per cent in the quarter ended September, the Reserve Bank of India showed in its first ever published 'nowcast' which is an estimate based on high-frequency data.
The economy had slumped about 24 per cent in April to June.
"India has entered a technical recession in the first half of 2020-21 for the first time in its history," the authors wrote.
The government is due to publish official statistics on November 27.
The Reserve Bank's number is buoyed by cost cuts at companies that boosted operating profits even as sales dipped. The team of authors also used a range of indicators from vehicle sales to flush banking liquidity to signal brightening prospects for October.
If this upturn is sustained, the Indian economy will return to growth in the October-December quarter, earlier than projected by Governor Shaktikanta Das last month, when he pledged to keep monetary policy accommodative.