India’s growth slows to 6.3% in July-September on higher prices

India’s economy expanded at a slower pace last quarter as price pressures, rising interest rates and sluggish trade tempered demand in Asia’s third largest economy.

Gross domestic product grew 6.3 per cent in the three months to September from a year ago, a drop from the preceding quarter’s 13.5 per cent, according to data released by Statistics Ministry on Wednesday. The number is in line with a median forecast of 6.2 per cent in a Bloomberg survey of economists.

India’s slower growth comes amid rising prices and a rapid increase in borrowing costs by the Reserve Bank of India as it tries to return inflation within its 2-6 per cent tolerance band. The RBI, which has raised its benchmark rate by 190 basis point this year, is expected to stay hawkish at the monetary policy review next week.

Meanwhile, tighter financial conditions globally are also stoking recession fears and are hurting the nation’s external finances.