Economy recovery gaining strength: RBI deputy governor

The recovery of the Indian economy was gaining strength but December quarter numbers could be lower than the 7.9% annual growth recorded in the September quarter, a Reserve Bank deputy governor said on Monday.                                           

Subir Gokarn also said food price inflation was a matter of concern and authorities would keep a watch on capital inflows.                                           

Government data showed on Monday the economy grew by 7.9% in the quarter through September from a year earlier, shattering market forecasts as stimulus measures boosted demand and manufacturing activity surged.                                           

"While it is a recovery and it seems to be gaining strength, we should not ignore the fact that it is still being driven substantially by public spending," Gokarn told reporters.