Gross domestic product expanded 7.8% on-year as growth in mining and manufacturing output weakened, the government said Tuesday. The reading was below the median expectation for 8.2% expansion, according to a poll of 19 economists. The economy had expanded 8.3% in the October-December quarter.For the full fiscal year ended March 31 the economy grew a provisional 8.5%, in line with the government's projection of 8.6%. That was well ahead of the 8.0% growth in the previous fiscal year, when the economy was shrugging off the effects of the global economic crisis.
By way of background, the BRIC economies are all seeing banks raise rates and/or reserve requirements to slow growth in an effort to slow inflation. These markets have been very important to US growth, especially for manufacturing. While the growth rate is still impressive -- and is hardly a problem in the long-run -- it will probably add further weight to the US slowdown at a time when it is least needed.
