India’s position as the world’s fastest-growing major economy continues to attract global confidence. After the International Monetary Fund (IMF) and the World Bank, global rating agency Moody’s has also increased its growth forecast for India. The agency now predicts that India will grow at 7.1% in the calendar year 2024, an upward revision from its earlier forecast of 6.8%.
Moody’s positive revision in India’s growth forecast showcases the growing global optimism around the country’s economic future, supported by strong domestic consumption and government initiatives.
Revised forecasts for 2024 and beyond with stable growth outlook
In its latest report, Moody’s has not only raised India’s GDP growth projection to 7.1% for 2024 but also retained its forecast of 6.5% growth for the fiscal year 2024-25. Additionally, the credit rating agency expects the Indian economy to expand by 6.6% in the fiscal year 2025-26.
This shows that Moody’s expects stable growth momentum for India in the coming years, as the country continues to benefit from infrastructure investments, a growing middle class, and policy reforms.
Inflation forecast lowered, offering relief to consumers
In addition to raising growth expectations, Moody’s has also revised India’s inflation forecast. The rating agency now expects inflation to average 4.7% in the upcoming period, slightly lower than its previous estimate of 5%.
This drop in inflation projections reflects India’s success in maintaining price stability, with retail inflation falling below 4% in July and August. Looking ahead, Moody’s predicts that inflation could ease to 4.5% in the fiscal year 2025-26, further supporting the country’s economic strength.
IMF, World Bank, and S&P show confidence in India’s economic strength
Moody’s isn’t alone in its optimism. The IMF and World Bank have also recently upgraded their growth forecasts for India. The World Bank increased India’s growth prediction to 7% for the financial year 2024-25, driven by higher government infrastructure spending and a better monsoon season. The IMF has also revised its projection for the current year to 7%, citing similar factors.
Global rating agency S&P has kept its forecast for India at 6.8% for 2024-25, further underlining the confidence that global agencies have in India’s economic prospects. Additionally, S&P hinted at possible rate cuts by the Reserve Bank of India (RBI) as early as October, further supporting economic growth.
