Terming India as the fastest-growing economy amid persistent global uncertainties, the Reserve Bank of India (RBI) on Wednesday projected real GDP growth at 6.7 per cent for FY27, 10 bps higher than its previous projection of 6.6 per cent in the prevision Monetary Policy Committee (MPC) meeting.
In his address, RBI Governor Sanjay Malhotra pegged Q1 FY27 GDP growth at 7 per cent, Q2 at 6.4 per cent, Q3 at 6.5 per cent, and Q4 at 6.8 per cent.
He said that supply-side pressures from the West Asia conflict have eased somewhat since June 2026.
However, the re-escalation of the conflict since the first week of July has amplified volatility in energy prices and renewed uncertainty around supply chains.
Amid persistent global uncertainty, domestic economic activity has remained resilient, as reflected in high-frequency indicators for Q1. Early corporate results for Q1 also indicate healthy performance in the manufacturing sector, said Malhotra.
Malhotra said headline inflation is projected to increase, primarily due to supply-side pressures from food and fuel, while core inflation remains moderate and is expected to decline after peaking in Q3.
He said the outlook remains hazy amid uncertainties around the Southwest monsoon, El Nino, geopolitics and global trade policy. He added that greater clarity is needed on the inflation trajectory and its composition before taking any policy action.
Malhotra further stated that underlying inflation, as reflected by core inflation excluding precious metals, has remained benign for some time and is expected to align with core inflation towards the end of the financial year.
On growth, Malhotra said the economy continues to be supported by resilient domestic demand, sustained expansion in manufacturing and services activity, and robust exports.
