New Delhi : Credit rating agency S&P Global Ratings has presented estimates regarding the GDP rate in the coming 2 years. According to this rating agency, the estimates of GDP rate for financial year 2025-25 and financial year 2026-27 have been cut. The reason behind its reduction is being said to be low urban demand due to high interest rates.
Updating its economic forecast for the Asia-Pacific economy after the US election results, the rating agency has projected GDP growth of 6.7 percent in FY 2025-26 i.e. April 2025 to March 2026 and 6.8 percent in the next fiscal 2026-27. The percentage is estimated to be. This is lower than previous estimates of 6.9 percent and 7 percent respectively.
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cut in GDP rate
For FY 2025-26 and FY 2026-27, the global rating agency has revised India's GDP growth forecast to 6.7 per cent and 6.8 per cent respectively, down 20 basis points from its previous estimates i.e. 100 basis points at 1 per cent. The number is equal to less. For 2027-28, the rating agency has kept India's forecast at 7 percent. S&P Global Ratings has said that in India we see the gross domestic product (GDP) growth rate slowing down to 6.8 percent in this financial year i.e. 2024-25, as higher interest rates and low fiscal impulse reduce urban demand. .
Weakness in Indian economy
The Reserve Bank of India had last week said that the weakness seen in the Indian economy, especially in the recent quarter, is behind us. Louis Kooij, chief Asia-Pacific economist at S&P Global Ratings, said rising risk appetite is clouding the economic outlook for Asia-Pacific in the first quarter of 2025. The Economic Survey tabled in Parliament earlier this year had estimated India's real GDP growth at 6.5-7 per cent for 2024-25, acknowledging that market expectations were much higher. Real GDP growth is reported economic growth adjusted for inflation.
food inflation
India's GDP grew by an impressive 8.2 per cent during the financial year 2023-24, remaining the fastest growing major economy. The economy is expected to grow by 7.2 percent in 2022-23 and 8.7 percent in 2021-22. Persistent food inflation is delaying rate cuts by the Reserve Bank of India or RBI. S&P Global Ratings expects the central bank to cut rates only once in the current fiscal year.
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