Q1 FY27 growth may surpass RBI’s 6.6 pc estimate if momentum continues: Report

New Delhi, June 6 (IANS) April and May high‑frequency indicators showed above‑average acceleration in growth and, if the trend continues in June, FY27 growth could surpass the Reserve Bank of India’s estimate of 6.6 per cent, a report said on Saturday.

The report from SBI Research said, “Despite external headwinds, the Indian economy is poised to remain the fastest‑growing major economy in FY27 by leveraging its sound macroeconomic fundamentals and robust financial sector.”

Further, “deflator might also increase to 6.5-7 per cent from its earlier estimate of 4.5-5 per cent”, thereby raising GDP growth to 12.5 per cent-13 per cent compared to the budgeted estimate of 10 per cent, the report noted.

The report highlighted formalisation and digitisation as drivers of labour productivity and improved institutional credit access and cited PLFS data suggesting training reduces informality in employment.

“With more digitisation and skill development initiatives by the government, we believe that the growth momentum will continue,” it forecasted.

Showcasing maturity and a rare sense of resilience, the Indian economy grew by 7.8 per cent in Q4 FY26, up from 7 per cent growth in the same quarter last fiscal.

Buoyed by the Q4 numbers, the annual FY26 growth is estimated at 7.7 per cent, up from 7.1 per cent in FY25.

SBI Research also noted that the recent US tech‑led stock sell‑off is due to thwarted market expectations of a dovish pivot by the Federal Reserve, as the US economy added more jobs than expected.

The high-growth tech sector is sensitive to interest rates due to duration risk, as it has stepped up borrowing aggressively of late, the report noted.

A recent report from Crisil Ratings said that a sharp rise in crude prices, a below‑normal monsoon and higher inflation will weigh on consumption and growth.

—IANS

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