Moody’s Ratings’ Outlook on India’s Q2 Growth

• Moody’s Ratings predicts steady economic momentum in India, despite concerns about weakening urban demand and underwhelming corporate results.

• The agency forecasts a 7.2% growth for India in 2024, followed by a 6.6% rise in 2025.

• The growth is driven by a revival in household consumption, robust investment, and strong manufacturing activity.

• The agency expects the Reserve Bank of India (RBI) to maintain relatively tight monetary policy settings into next year due to healthy growth dynamics and inflation risks.

• The agency also expects growth in the consumption front due to higher spending in the festive season and a sustained pickup in rural demand.

• Moody’s expects growth in the G-20 economies to slow to 2.8% this year from 3% in 2023, before cooling further to 2.6% and 2.5% over 2025 and 2026.

• The growth in G-20 emerging markets will grow by 4.3% in 2024, down from 4.8% in 2023, and decelerate to 3.9% in 2025 and 3.8% in 2026.