Fitch slashes FY23 India growth forecast to 8.5% on high energy prices

Rating agency Fitch on Tuesday slashed India’s growth forecast for the next fiscal to 8.5 per cent from 10.3 per cent, citing sharply high energy prices on account of the Russia-Ukraine war.

With the Omicron wave subsiding quickly, containment measures have been scaled back, setting the stage for a pick-up in GDP growth momentum in the June quarter this year, the agency said.

It has revised upwards the GDP growth forecast for the current fiscal by 0.6 percentage points to 8.7 per cent.

“However, we have lowered our growth forecast for FY 2022-2023 to 8.5 per cent (-1.8 pp) on sharply higher energy prices,” Fitch said while revising up its inflation forecasts.