The International Monetary Fund (IMF) released its latest World Economic Outlook (WEO) on Tuesday, sharing a positive outlook on India’s growth trajectory.
The multinational lender IMF forecasted that India will grow at 7% in the current fiscal year, which will end on March 31, 2025. IMF expects India to grow at 6.5% in FY25-26.
IMF report shares that India’s growth rate dropped from 8.2% in 2023 that is “because pent-up demand accumulated during the pandemic has been exhausted as the economy reconnects with its potential.” India is getting ready for its economic evolution.
The U.S., on the other hand, is expected to continue leading the way for the global economy in 2024 and 2025. The main reason behind this is the robust consumer spending in the U.S. that withstand even during inflation.
The IMF’s latest world economic outlook predicts that the global GDP growth will remain unchanged at 3.2% throughout the year, setting a lacklustre tone of growth.
Pierre-Oliver Gourinchas the chief economist of IMF, told reporters that there is a geopolitical risk with the potential for escalation of regional conflicts. He also identified growing protectionist policies as one of the risks. Tight monetary policies in some countries also impact the labour market, which is another risk for GDP growth.