RBI Survey Raises FY27 Growth Forecast to 6.6%

According to the Reserve Bank of India’s 101st Survey of Professional Forecasters (SPF), there has been slight increase in the expectations for both economic growth and retail inflation for FY27. This survey, which was conducted in the month of July 2026, as per the survey the real GDP growth is around 6.6%, which is an improvement from 6.5% that was projected in the previous survey, while the retail inflation is estimated at 5%. In FY28, however, the outlook is much brighter, with growth expected at 7% and inflation at 4.5%, indicating an impending “Goldilocks” phase in the Indian economy.

What Do the Latest Projections by the RBI Indicate?

The Reserve Bank of India’s 101st Survey of Professional Forecasters took place in July 2026 and gives a projection of the economists’ expectations about the state of India’s economy.

For FY27, the following projections are made by the survey:

• Real GDP growth: 6.6%
• Retail inflation: 5%
• Merchandise export growth: 7%
• Merchandise import growth: 9.9%
• Current account deficit: 1.4% of GDP

Compared to the previous survey carried out in May, there has been an improvement of the growth and inflation forecasts by 10 basis points each.

Growth Prospects Better in FY27

There has been an improvement in the SPF’s FY27 real GDP growth forecast from 6.5% to 6.6%.

This improvement arises from expectations of the continuation of the support by domestic demand, manufacturing, services, and exports.

Indeed, the RBI’s outlook is somewhat more positive. In its August 5 monetary policy review, it improved its FY27 GDP growth forecast by 10 basis points to 6.7%.

Thus, the RBI’s projection is currently 0.1 percentage point above the SPF forecast.

Inflation Forecast Revised Up to 5%

Despite positive expectations about growth, there are also positive forecasts about inflation.

Retail inflation forecast for FY27 increased from 4.9% to 5%.

RBI forecasts FY27 inflation also at 5%, but expects the pressure to be mainly from supply side pressures, rather than become broad-based.

Risks might be posed by changes in food and fuel prices, weather conditions and geopolitical environment.

Core inflation, excluding the volatile food and fuel items, will likely stay moderate.

FY28 Outlok Suggests ‘Goldilocks’ Environment

Things become even more positive for FY28.

SPF revised its growth forecast for FY28 up from 6.9% to 7% but kept its inflation forecast unchanged at 4.5%.

Such combination of high economic growth and low inflation has been termed as “Goldilocks” scenario.

In economic terms, Goldilocks economy is an economy with good growth rate which can help support economic activity and employment without causing inflation.

Though, inflation might be slightly above the RBI’s medium term target of 4%, it indicates movement to stable price environment.

What Makes India Grow?

Factors behind India’s growth have been listed down by RBI Governor Sanjay Malhotra.

They are.

• Strengthening domestic demand
• Continuation of expansion of manufacturing
• Activity in services sector
• High export activity

But economic growth does come with risks too.

According to RBI, risks for economic growth are associated with uncertainty about south-west monsoons, El Nino, geopolitical conditions and global trade policies.

Improvement in the Export Projections of India

The latest survey by the SPF has also upgraded the outlook for the merchandise exports of India.

The merchandise export growth forecast for FY27 stands at 7% against the previous forecast of 5%.

At the same time, the merchandise import growth forecast is expected to come down to 9.9% against the earlier forecast of 10.5%.

It has positively impacted the external balance due to the better performance of the exports and a slower growth in imports.

Narrowing of Current Account Deficit Forecast

According to the latest SPF forecast, the current account deficit (CAD) of India for FY27 would stand at 1.4% of GDP against the previous forecast of 2.1%.

Also, the FY28 forecast has been marginally reduced from 1.2% to 1.1% of GDP.

A narrower current account deficit signifies a smaller gap between the external receipts and payments, but the actual figure may be impacted by factors such as trade, services, investment income, and others.

How Does the IMF Projection Differ?

The IMF has a slightly conservative growth projection for FY27.

According to its July 2026 World Economic Outlook report, the IMF has cut its FY27 growth forecast for India from 6.5% to 6.4%.

But the FY28 forecast has been upgraded from 6.5% to 6.7%.