Macroeconomic Forecast India

January 2007 | Macroeconomic Forecasts

BMI View: We have raised our FY2006/07 (July-June) growth forecast to 8.7%, from 8.3% in response to an extremely strong first half of the year. We expect the economy to slow as the year progresses, in response to tighter monetary policy and a slowing global economy. Another interest rate hike is expected at the Reserve Bank of India (RBI)'s January 31 meeting, and with inflation expected to rise above the 5.5% ceiling of the central bank's target range over the next few months, this is unlikely to be the end of the tightening cycle. We expect India's growth rate to

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