Latest news with #EconomyWatch
Fibre2Fashion
a day ago
- Business
- Fibre2Fashion
India's GDP growth expected to moderate in FY26: EY Economy Watch
India's gross domestic product (GDP) growth is expected to slow down in this fiscal due to both global and domestic factors, according to EY's latest Economy Watch report, which said the country is likely to remain one of the fastest-growing large economies despite the expected moderation. The factors leading to a cautious outlook include problems in supply chains, recent US tariffs and general uncertainty in global trade and geopolitics. India's GDP growth may slow down in this fiscal due to both global and domestic factors, including supply chain problems, US tariffs and general uncertainty in global trade and geopolitics, an EY report said. The country is likely to be one of the fastest-growing large economies despite the likely moderation due to strong domestic demand, lower inflation and supportive monetary policies, it noted. The country's growth will be due to strong domestic demand, lower inflation and supportive monetary policies that may encourage private investment, it noted. The country's government may have to carefully mix monetary and fiscal policies to maintain growth in the near future, EY cautioned. "On the monetary front, a continuation of the ongoing rate cut cycle could provide support to consumption and investment. On the fiscal side, reviving the momentum in public investment, especially GoI's [government of India] capital expenditure, which witnessed a moderation in growth in FY25, will be important to sustain economic activity," EY added. The country's consumer price index-based inflation eased to a 69-month low of 3.2 per cent in April this year, while manufacturing purchasing managers' index increased to a ten-month high of 58.2 in the month. Merchandise trade deficit increased to a six-month high of $26.4 billion in April, owing to a sharp increase in growth in imports. Fibre2Fashion News Desk (DS)
India Gazette
3 days ago
- Business
- India Gazette
Increased capex, focus on rare earth minerals may shape India's 'Viksit Bharat' journey: EY report
New Delhi [India], May 28 (ANI): An increased capital expenditure and focus on rare earth minerals may shape India's Viksit Bharat journey, according to a report by EY. It suggested that policy measures must balance consumption support with increased capital expenditure. Also, India's long-term growth relies on building resilience through self-reliance in critical minerals. Critical minerals are those minerals that are essential for economic development and national security. In June 2023, India has identified at least 30 critical minerals taking into account its requirements for sectors like defence, agriculture, energy, pharmaceutical, and telecom. India has launched a National Critical Mineral Mission in 2025 to address this, but further support from both the public and private sectors will be important, EY said. Strengthening partnerships with countries rich in rare earth resources could also help reduce supply chain risks. According to the EY Economy Watch May edition, India's economic growth for 2025-26 is expected to moderate, influenced by a mix of global and domestic developments. Yet, the EY report said India remains one of the fastest-growing major economies, supported by resilient domestic demand, easing inflation, and an accommodative monetary policy linked to prospects of revival in private investment. As per EY report analysis, global factors are largely contributing to a cautious outlook. These include continuing supply chain disruptions, the impact of recent tariff measures by the US, and broader uncertainties in global trade and geopolitical developments. EY report suggests that in the near term, India may need to rely on a balanced mix of monetary and fiscal policies for sustaining the growth momentum. On the monetary front, a continuation of the ongoing rate cut cycle could provide support to consumption and investment. On the fiscal side, reviving the momentum in public investment especially the government's capital expenditure, which witnessed a moderation in growth in 2024-25, will be important to sustain economic activity. DK Srivastava, Chief Policy Advisor, EY India said, 'While India's medium-term prospects remain strong, current global headwinds and domestic challenges call for supportive fiscal and monetary policies. Over the long run, sectors linked to technology and clean energy will play a key role in driving sustainable growth. Building resilience through self-reliance in critical minerals, especially in rare earths, can help India move closer to its Viksit Bharat aspirations.' (ANI)
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Business Standard
3 days ago
- Business
- Business Standard
India's economic growth to moderate in FY26 amid global headwinds: EY
India's economic growth is expected to slow down in the current financial year due to both international and local factors, according to EY's latest Economy Watch report released on Wednesday, adding that it may have to depend on a careful mix of monetary and fiscal policies to maintain growth in the near future. Despite the expected moderation, India is likely to remain one of the fastest-growing large economies, the EY report noted. This is due to strong domestic demand, lower inflation, and supportive monetary policies which may encourage private investment. "India's economic growth for FY26 is expected to moderate, influenced by a mix of global and domestic developments," the report stated. Global challenges weigh on outlook The EY analysis highlights that several global issues are leading to a cautious outlook. These include ongoing problems in supply chains, recent trade tariffs introduced by the US, and general uncertainty in global trade and geopolitics. "On the monetary front, a continuation of the ongoing rate cut cycle could provide support to consumption and investment. On the fiscal side, reviving the momentum in public investment, especially GoI's capital expenditure, which witnessed a moderation in growth in FY25, will be important to sustain economic activity," EY said. Official growth forecasts In February, the National Statistical Office (NSO) estimated that India's economy would grow by 6.5 per cent in 2024–25. It also projected quarterly growth rates of 6.5 per cent for June, 5.6 per cent for September, and 6.2 per cent for December. The NSO is set to release provisional GDP data for FY25 and the figures for the fourth quarter on May 31. Recent monetary policy actions In April, the Reserve Bank of India's Monetary Policy Committee (MPC) — comprising three RBI officials and three external experts — unanimously agreed to cut the repo rate by 25 basis points to 6 per cent. A similar reduction was made in February, marking the first rate cut since May 2020. Economists expect that the RBI will continue its rate-cutting cycle, given continuing low inflation, a good kharif crop, and expectations of an above-normal monsoon this year, which will help the farm economy. For the 2025–26 financial year, the RBI has also projected GDP growth at 6.5 per cent. The next MPC meeting is expected to take place on June 6.
Time of India
3 days ago
- Business
- Time of India
India to remain among fastest-growing major economies even as growth may moderate in FY26: EY
India's economic growth is anticipated to slow down in the current fiscal year due to global uncertainties and domestic factors. To maintain growth, a balanced approach to monetary and fiscal policies is crucial. While India remains a fast-growing economy, supported by domestic demand and easing inflation, reviving public investment is essential for sustaining economic activity. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's economic growth is expected to moderate in the current fiscal influenced by global and domestic developments and the country may need to rely on a balanced mix of monetary and fiscal policies for sustaining the growth momentum in the near term, an EY report said on will remain one of the fastest-growing major economies, supported by resilient domestic demand, easing inflation, and an accommodative monetary policy linked to prospects of revival in private investment, according to the EY Economy Watch May edition "India's economic growth for FY26 is expected to moderate, influenced by a mix of global and domestic developments," it per EY report analysis, global factors are largely contributing to a cautious outlook. These include continuing supply chain disruptions, the impact of recent tariff measures by the US, and broader uncertainties in global trade and geopolitical report said that in the near term, India may need to rely on a balanced mix of monetary and fiscal policies for sustaining the growth momentum."On the monetary front, a continuation of the ongoing rate cut cycle could provide support to consumption and investment. On the fiscal side, reviving the momentum in public investment especially GoI's capital expenditure, which witnessed a moderation in growth in FY25, will be important to sustain economic activity," EY February, the National Statistics Office (NSO) had projected the Indian economy to grow at 6.5 per cent in 2024-25, with economic growth in June, September and December quarters at 6.5 per cent, 5.6 per cent and 6.2 per cent, NSO is scheduled to release the provisional estimates of FY25 GDP and quarterly estimates for Q4 on May April, the RBI's monetary Policy Committee (MPC), consisting of three central bank members and an equal number of external members, voted unanimously to cut the repurchase or repo rate by 25 basis points to 6 per 2025-26 fiscal, RBI has projected GDP growth at 6.5 per next meeting of the MPC is scheduled for June 4-6. The monetary policy will be announced on June 6.
Fibre2Fashion
29-04-2025
- Business
- Fibre2Fashion
EY forecasts 6.5% GDP growth in India in FY26
Despite rising global trade tensions and the international economy slowing down, India's economy may expand by 6.5 per cent in this fiscal, backed by falling crude oil prices and manageable inflation levels—a consumer price index (CPI)-based inflation below 4 per cent, according to the 100th edition of EY's 'Economy Watch' report. CPI inflation eased to a 67-month low of 3.3 per cent in March 2025 as prices of vegetables fell, whereas core CPI inflation moderated to 4.1 per cent in March 2025 from 4.2 per cent in February 2025. Four key global factors were outlined shaping India's growth outlook: reduced exports, a global slowdown, declining crude oil prices and a glut in global production capacities. Despite rising global trade tensions and a slowing international economy, India's economy may expand by 6.5 per cent in this fiscal, backed by falling crude oil prices and manageable inflation levels, a latest EY report said. Four key factors were outlined shaping India's growth outlook: reduced exports, a global slowdown, declining crude oil prices and a glut in global production capacities. Crude prices, which were at $75 per barrel in early April, dropped to $65 by mid-month and are expected to remain in the range of $60–65 per barrel through FY26. This is expected to ease inflationary pressure and help domestic growth. Meanwhile, exports are likely to take a hit from rising global tariffs and weakening demand. EY, however, suggested that the damage to overall gross domestic product (GDP) may be limited since net exports have played a smaller role in India's recent growth. To navigate this, the report suggests India to consider anti-dumping measures to counter the risk of oversupply from countries with excess production. It also suggests changes to the country's crude oil sourcing strategy, such as raising imports from the United States, which could help improve the trade balance. In March 2025, manufacturing purchasing managers' index increased to an eight-month high of 58.1. The index of industrial production growth moderated to a six-month low of 2.9 per cent in February this year due to a fall in the growth of manufacturing and mining output. Fibre2Fashion News Desk (DS)
