IMF raises India’s FY24 GDP growth forecast to 6.3% – report

MUMBAI (Reuters) -India’s economic growth forecast for the current fiscal year has been raised to 6.3% from 6.1% earlier, the International Monetary Fund said in its October 2023 World Economic Outlook (WEO) report that was released on Tuesday.

The global lender expects retail inflation in the South Asian nation to rise to 5.5% in 2023/24 before easing to 4.6% in 2024/25.

“Growth in India is projected to remain strong, at 6.3% in both 2023 and 2024, with an upward revision of 0.2 percentage points for 2023, reflecting stronger-than-expected consumption during April-June,” the IMF said.

The Reserve Bank of India has projected consumer price index (CPI)-based inflation for the current fiscal year at 5.4% while GDP growth is seen at 6.5%.

Monetary policy projections are consistent with achieving the Indian central bank’s inflation target over the medium term, the IMF said.

The country’s current account deficit is expected to remain at 1.8% of GDP in FY24 and FY25, the IMF added.

IMF cut its growth forecasts for China and the euro area and said overall global growth remained low and uneven despite what it called the “remarkable strength” of the U.S. economy.

The IMF left its forecast for global real GDP growth in 2023 unchanged at 3.0% in its latest WEO, but cut its 2024 forecast by 0.1 percentage point to 2.9% from its July forecast.

(Reporting by Swati Bhat; editing by Sudipto Ganguly)