Times of India | Moody’s cuts India FY27 growth forecast to 6%, cites energy shocks and weaker consumption
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Moody’s has trimmed its outlook for India’s fiscal year 2027, cutting the projected GDP growth rate to 6 percent from 6.8 percent, citing weakening consumer demand and slower industrial performance as energy and input costs rise amid the West‑Asia conflict. While the agency still expects FY 2026 growth to be about 7.6 percent, it warns that higher oil and gas prices will lift import bills, increase fuel and fertiliser subsidies, and strain government finances, potentially widening the trade deficit and adding fiscal pressure. India’s heavy reliance on Middle‑Eastern oil, gas and nitrogen‑based fertilisers makes it vulnerable to supply disruptions, though strategic reserves and commercial inventories should partly cushion the impact. Moody’s notes that energy‑intensive sectors such as cement, chemicals and aviation may face margin pressure, whereas infrastructure and utilities are likely to remain stable thanks to regulated returns and domestic fuel access. The report highlights that strong foreign‑exchange reserves, low external debt and continued infrastructure spending, along with robust services exports, help preserve India’s external position, though prolonged instability in Gulf Cooperation Council countries could curtail remittance inflows, pressure the current account and the rupee, and may require central‑bank intervention.
Read more: https://timesofindia.indiatimes.com/business/india-business/moodys-cuts-india-fy27-growth-forecast-to-6-cites-energy-shocks-and-weaker-consumption/articleshow/130420569.cms
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