EXPECT ROCKET GROWTH

GOVERNMENT spending is expected to play a significant role going ahead in 2025. It was pushed to the backseat in 2024 which was mostly an election year. In the second quarter (April-June) of 2024, the entire government machinery was engaged in preparing for and conducting the Lok Sabha polls. This was followed by assembly elections in states like Haryana, Jammu & Kashmir, Maharashtra and Jharkhand. During this period, for the most part, the model code of conduct was in force, forcing the government to refrain from announcing and executing major projects including the infrastructure push. As a result, we saw the gross domestic product (GDP) plunging to a 7-quarter low of 5.4 per cent during Q2 (July-September) 2024.

- JIMEET MODI, Founder & CEO, SAMCO Group

With the inflation staying outside the comfort level of Reserve Bank of India's (RBI) 4-6 per cent band, due to variety of reasons, the central bank was forced to keep the interest rates unchanged at higher levels. With the US Fed's latest cut of 25 basis points (bps), the US interest rates have come down by 100 bps in 2024. However, the hawkish commentary of US Fed has pared down the market expectation of speed of the US interest rate cut. Next year, the US Fed may not go for interest rate cut of more than 50 bps as inflation in the US is inching up. It is now to be seen what stand the RBI takes in the new year in its first meeting slated in February.