Friday for Fitch ratings..! Indian economic growth estimates reduced to 6.8% for FY 20

New Delhi, March 22: Reducing over the India’s economic forecast, the Fitch ratings on Friday estimated the growth forecast at 6.8 per cent from the previous that of 7 per cent, on weaker than expected momentum in the economy for the financial year starting from 1st of April.

 

"While we have cut our growth forecasts for the next fiscal year ending in March 2020 on weaker than expected momentum, we still see Indian GDP growth to hold up reasonably well, at 6.8 per cent, followed by 7.1 per cent in FY21," Fitch said in its Global Economic Outlook.

According to Fitch, the RBI, has adopted a more dovish monetary policy stance and cut interest rates by 0.25 percentage at its February 2019 meeting, a move supported by steadily decelerating headline inflation. The rating agency has also cut growth forecasts for FY 20 and FY 21 to 7 per cent from 7.3 per cent and 7.1 per cent from 7.3 per cent, respectively.

"We have changed our rate outlook and we now expect another 25 bp cut in 2019, amid protracted below target inflation and easier global monetary conditions than previously envisaged," it said.

"On the fiscal side, the budget for Financial Year 20, plans to increase cash transfers for farmers," it added further, saying that, “it's benign oil price outlook and expectations of accelerating food prices in the coming months should support rural households' income and consumption”