Moody’s Raises India FY27 Growth Forecast to 7% Amid Economic Resilience
The rating agency cites strong domestic activity while warning that energy costs and food inflation remain key risks.
New Delhi: Moody’s has raised its forecast for India’s real gross domestic product growth in fiscal year 2026-27 to 7 per cent from its earlier projection of 6 per cent, citing the resilience of the Indian economy despite continuing global uncertainties.
The revised estimate comes amid strong domestic economic activity and follows a 7.8 per cent year on year expansion recorded by India during the April-June quarter, according to Reuters.
Moody’s said investment and manufacturing activity have supported economic growth, helping offset weaker performance in sectors such as mining and consumer services.
The rating agency’s revised projection reflects its assessment that India has been able to maintain economic momentum despite challenges arising from geopolitical tensions and elevated energy prices.
However, Moody’s also highlighted several risks to the outlook. Higher global energy prices could increase pressure on domestic inflation and government finances, while the possibility of El Niño related food inflation could affect household consumption.
The agency also pointed to increased government spending on defence and infrastructure as a factor that could make fiscal consolidation more challenging.
India’s economic performance is being closely watched as global markets continue to deal with geopolitical uncertainty, changing interest-rate conditions and fluctuations in commodity prices.
Moody’s expects India to remain among the faster-growing major economies, although it cautioned that external shocks, particularly those affecting energy costs, could influence the pace of expansion.
The revised growth estimate provides a more positive assessment of India’s near term economic momentum while underscoring the need to monitor inflation, energy prices and fiscal pressures.
