OECD lifts India's FY26 growth outlook to 6.7%; S&P retains at 6.5%
- IBEF
- September 24, 2025
The Organisation for Economic Co-operation and Development (OECD) has raised India’s FY26 growth forecast by 40 basis points (bps) to 6.7%, attributing the upgrade to monetary and fiscal easing and the recent Goods and Services Tax (GST) cuts. The OECD also expects India’s consumer inflation to average 2.9% in FY26, down from 4.1%, supported by strong food supply and export restrictions. It projects inflation to remain near 3% in FY27.
Global credit rating agency S&P Global retained India’s FY26 growth forecast at 6.5%, citing strong domestic demand, a favourable monsoon, GST and income tax cuts, and higher government investment. S&P cut its inflation estimate to 3.2% for FY26 and anticipates a 25 basis point rate cut by the Reserve Bank of India (RBI). Globally, the OECD reported 3.2% growth in H1 2025, above its earlier forecast, driven by front-loaded production and trade before higher US tariff rates, but warned of a slowdown later this year as geopolitical uncertainty damps investment and consumption.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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