Indian economy is in good shape. Also, the pace of growth of the economy will be 7.2 percent in the calendar year 2024 and in the next year i.e. 2025, it will grow at a speed of 6.6 percent. This latest estimate was made by Moody's Ratings on Friday. Moody's has said that the Indian economy has a mix of solid growth and mild inflation. In its Global Macro Outlook 2025-26, Moody's said the global economy has been hit by supply chain bottlenecks during the pandemic, energy and food crises after the start of the Russia-Ukraine war, high inflation and resulting monetary tightening, PTI reported. Has shown remarkable resilience in recovering from policy tightening.
Most G-20 economies will experience stable growth
Apart from India, Moody's has also said that most G-20 economies will experience stable growth and continue to benefit from policy easing and supportive commodity prices, according to the news. However, post-election changes in US domestic and international policies could potentially accelerate global economic fragmentation, complicating ongoing stabilization. The aggregate and net effects of trade, fiscal, immigration and regulatory policy changes will expand the range of consequences for countries and regions.
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Regarding India, Moody's said real GDP growth in the second quarter (April-June) of 2024 was 6.7 per cent year-on-year due to improvement in domestic consumption, strong investment and strong manufacturing activity. High-frequency indicators – including expanding manufacturing and services PMIs, strong credit growth and consumer optimism – point to steady economic momentum in the third quarter. In fact, from a macroeconomic perspective, the Indian economy is in a good shape with a mix of solid growth and moderate inflation.
Continued growth in rural demand will get a boost
Moody's said domestic consumption in India is likely to grow, underpinned by an increase in spending during the current festive season and continued growth in rural demand due to an improved agricultural outlook. Additionally, increased capacity utilisation, upbeat business sentiment and continued emphasis on infrastructure spending by the government should support private investment. It said good economic fundamentals, including healthy corporate and bank balance sheets, strong external position and adequate foreign exchange reserves, also bode well for the growth outlook.
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