India Retained Its GDP Growth of 6% in 2023-24, Says S&P – News18
There is no change in growth for the current financial year.
S&P stated that the retail inflation might decline to 5% from 6.7% in the current fiscal year and RBI is expected to cut interest rates next year.
US-based business analytics firm S&P recently, in their ratings, mentioned that India maintained its position as the fastest-growing major economy. With a growth rate of 6%, India is the fastest-growing country in the Asia-Pacific region. The Indian economy had a growth rate of 7.2% in the fiscal year 2022–23.
Due to the domestic economy, there has been no change in growth for the current financial year. S&P stated that retail inflation might decline to 5% from 6.7% in the current fiscal year, and it is also expected that the RBI will cut interest rates next year. A reduction in crude oil and a normal monsoon can smooth out inflation. According to S&P, India, Vietnam, and the Philippines will grow by 6%, but China’s growth has reduced in 2023 from 5.5% to 5.2%.
“In India, we expect headline consumer inflation to fall to 5% in fiscal 2024 from 6.7% in fiscal 2023, assuming normal monsoons,” said Louis Kujis, Chief Economist, Asia, S&P Ratings. “Lower crude prices and lower demand will reduce fuel and core inflation, respectively. From our perspective, the inflation and rate hike cycles have peaked. However, we estimate the Reserve Bank of India will decrease rates only in early 2024, as it wants consumer inflation to reach 4%, the middle of its target range’’.
On June 8, The Reserve Bank of India (RBI) also revised the inflation forecast for fiscal year 2023-24. The RBI had cut inflation from 5.2% to 5.1% in April’s policy. This decision was made after the dip in inflation readings. However, the print is expected to remain above the 4% objective for this fiscal year, even though there are upside risks to food and commodity prices from probable supply cuts.
According to the World Bank’s prediction, India will maintain its GDP and aggregate even if there is a slowdown in growth, and they stated the reason is “resilience in private consumption and investment, as well as robust growth in the services sector in India.”
The World Bank mentioned that India will lift growth for Fiscal years 2024, 2025, and 2026 to 6.3%, 6.4%, and 6.5%, respectively.
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