News Brief

India’s Economic Outlook Brightens: Fitch Ratings Raises FY25 GDP Growth Forecast To 7.2 Per Cent

Kuldeep Negi

Jun 18, 2024, 02:03 PM | Updated 02:03 PM IST

Fitch predicts India's GDP to grow 7.2 per cent in FY25(Representative Image)
Fitch predicts India's GDP to grow 7.2 per cent in FY25(Representative Image)

Global rating agency Fitch has raised India's GDP growth forecast for FY25 to 7.2 percent from its previous estimate of 7 percent, citing a recovery in consumer spending and increasing investment trends as key factors for the upward revision.

"We expect the Indian economy to grow by a strong 7.2 percent in FY25," Fitch stated in its global outlook report.

The report also projects the Indian economy to grow at 6.5 percent and 6.2 percent in FY26 and FY27, respectively.

While investment growth is expected to continue, the pace will be slower compared to recent quarters.

Consumer spending, on the other hand, is expected to recover, supported by elevated consumer confidence.

"Investments will continue to rise but it will be slow in comparison to recent quarters while consumer spending will recover with elevated consumer confidence," Fitch noted in its outlook.

Additionally, Fitch forecasts the retail inflation rate to decrease to 4.5 percent by the end of this year and further down to 4.3 percent in 2025 and 2026.

This revision follows a similar move by the World Bank, which recently raised India's FY25 GDP growth forecast to 6.6 percent from 6.4 percent.

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Kuldeep is Senior Editor (Newsroom) at Swarajya. He tweets at @kaydnegi.

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