Global investment bank Goldman Sachs has raised India’s real GDP growth forecast to 6.8 per cent for the calendar year 2026, from its earlier estimate of 6.5 per cent, citing easing oil prices and improving domestic economic conditions.
In its latest report titled India: Improved Macro Outlook After The US and Iran deal, the global investment bank lowered its headline inflation forecast by 0.2 percentage points to 4.4 per cent and reduced its current account deficit estimate to 1.1 per cent of GDP, amid a sharp correction in global crude oil prices after the US-Iran peace deal.
According to Goldman Sachs, the country’s economy remained resilient despite the disruptions caused by the Middle East conflict, as government fiscal and quasi-fiscal measures helped cushion the impact of higher energy prices on consumers.
The report noted that softer global commodity prices, particularly the sharp decline in urea prices, would help reduce India’s fertiliser subsidy burden, easing near-term fiscal pressures along with lower crude oil prices. Despite the improved outlook, it cautioned that weather-related uncertainties and the impact of earlier fuel price increases could remain short-term headwinds for consumption before the economy gathers further momentum later in the year.
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