CB trims 2012 GDP growth estimate to 6.8%

Reuters: The Central Bank lowered its 2012 economic growth estimate to 6.8% from an earlier 7.2%, blaming the drought for the second downward revision this year, Governor Ajith Nivard Cabraal said on Thursday.

“Right now our view is there will be reduction in growth from the earlier estimated 7.2%. Drought has been a factor and there are some sectors contributing to the overall reduction, while some sectors have done better than we expected,” Cabraal told Reuters.

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In March the Central Bank cut the growth estimate to 7.2% from an original 8% due to tight monetary policy measures it implemented in February. Last year the country’s growth was a record 8.3%.

On Monday Treasury Secretary P.B. Jayasundera lowered his growth forecast to a minimum of 6.5%, due to the impact of the drought and global economic uncertainty.

The economy grew at its slowest pace for two-and-a-half years in the second quarter.