S&P Global Upgrades India’s FY24 Growth Forecast to 6.6%

S&P Global Market Intelligence has reevaluated India’s economic growth prospects for the fiscal year 2024 (FY24). This upward revision is attributed to robust economic performance in the April-June quarter. Notably, the revised projection stands at 6.6%, a significant improvement from the 5.9% estimate put forth by the analytics firm in August.

Inflation on the Rise

While the revised growth forecast is promising, S&P Global Market Intelligence also presents a concerning prediction regarding inflation. The analytics firm anticipates a sharp increase in inflation, with the rate surging to 6% in 2023. This projection marks a noteworthy climb from the 5.1% inflation rate estimated in August. Of particular note, this level of inflation is approaching the upper boundary of the Reserve Bank of India’s target range.

Divergence with RBI’s Outlook

S&P Global’s outlook contrasts with that of the Reserve Bank of India (RBI). While both entities have their perspectives on the Indian economy, S&P Global holds a more optimistic stance concerning economic growth. In contrast, they maintain a more pessimistic viewpoint when it comes to inflation.

Impact on Exports

Furthermore, S&P Global Market Intelligence points to an additional factor that could influence India’s economic landscape. They anticipate that the deceleration of global economic growth will exert pressure on India’s exports. This insight underscores the interconnectedness of the global economy and its implications for India’s economic prospects.

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