Global investment banking, securities and investment management company Goldman Sachs, on Monday, revised India's GDP (gross domestic product) growth for 2024, increasing it by 10 basis points (bps).
According to the revised figures, the new GDP forecast is 6.7 per cent.
“Going forward, we expect investment growth momentum to sustain with extra fiscal space for infrastructure spending given a higher than expected dividend transfer by the RBI. As a result, we recently revised our growth forecasts for CY24 slightly higher by 10bp to 6.7 per cent YOY,” a note co-authored by Goldman Sachs economists Andrew Tilton, Santanu Sengupta and Arjun Varma read.
The global investment firm also expects the central bank to cut interest rates in the third quarter of the current fiscal year 2024-25.
The RBI, according to the analysts, will wait and watch the progress of monsoons and Kharif crops to understand the trajectory of food inflation before moving towards monetary policy easing.
“We continue to expect a shallow easing cycle of total 50 basis points (bps) rate cuts from the RBI, with 25bps rate cuts each in Q4-CY24 and Q1-CY25,” the note from the analysts read, according to a Business Standard report.
According to Goldman Sachs analysts, the core inflation rate is expected to bottom out in the second quarter of the calendar year (CY) and go up to 4 to 4.5 per cent mark, from an average of 3.4 per cent YoY in January till April 2024, in the second half of the CY 24.
