Moody’s Cuts India GDP Growth Forecast to 8.8% for Year 2022

Moody's Cuts India GDP

Moody’s has cut India Gross Domestic Production (GDP) growth forecast to 8.8 percent from its earlier estimate of 9.1 percent for the year        2022.

Even after the its downward revision, the GDP forecast by Moody’s remains among the most optimistic. While the RBI has projected that the economy will grow 7.2 per cent in financial year 2022-23 (FY23), Fitch expects the economy to grow 8.5 per cent. To be sure, Moody’s has not yet revised its FY23 GDP forecast for India, which remains at 9.1 per cent.

“High-frequency data suggest that the momentum from Q4 2021 carried through into the first four months of this year because of strong reopening momentum. Strong credit growth, a large increase in investment intentions announced by the corporate sector, and a high budget allocation to capital spending by the government indicate that the investment cycle is strengthening,” it added.

The rating agency added in its latest Global Macro Outlook that unless global crude oil and food prices rise further, the economy seems strong enough to maintain solid growth momentum. Moody’s expects India’s retail inflation to increase to 6.8 per cent in 2022 from 5.7 per cent in 2021. Retail inflation touched a near eight-year high of 7.8 per cent in April.


Knowledge Source :

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