Moody's raises India's FY24 GDP growth forecast to around 8% from 6.6%

The country’s National Statistical Office (NSO) projected 8.4 per cent growth in the third quarter (Q3) of FY24. It also revised GDP estimates for Q1 and Q2 to 8.2 per cent and 8.1 per cent from 7.8 per cent and 7.6 per cent respectively.

India’s real GDP growth was 7 per cent in FY23.

India will also benefit from increased global trade and investment opportunities when companies diversify away from China, Moody’s noted.

"We expect India's inflation rate will decline to 5.5 per cent in [fiscal] 2023-24 from a peak of 6.7 per cent in fiscal 2022-23, and further disinflation will support monetary easing going forward," it said.

Banks' capitalisation will stay strong as their internal capital generation keeps pace with capital consumption, it said. They will also be able to raise capital easily if needed, given India's buoyant equity market.

ALCHEMPro News Desk (DS)