Moody’s cuts India’s gross domestic product growth outlook for this yearMoody’s slashed India’s economic growth projection for 2022 to 7.0 per cent from 7.7 per cent, as a global slowdown and rising domestic interest rates would dampen economic momentum.Moody’s Investors Service has now lowered its projections for India’s growth twice. In September, it had reduced its estimates for the current year to 7.7 percent from 8.8 percent in May.”For India, the 2022 real GDP growth projections have been lowered to 7 per cent from 7.7 per cent. The downward revision assumes higher inflation, high-interest rates and slowing global growth will dampen economic momentum by more than we had previously expected,” the agency said in its Global Macro Outlook 2023-24.According to Moody’s, growth will slow further to 4.8 per cent in 2023 and then pick up to about 6.4 per cent in 2024.India grew at 8.7 per cent in the 2021-22 fiscal (April 2021 to March 2022).The report said that due to persistent inflation, tightening monetary policy, fiscal issues, geopolitical developments, and financial market volatility, the global economy is on the cusp of a slump.2023 will see a slowdown in global growth, which will continue until 2024. Nevertheless, if governments and central banks are able to guide their economies through the current difficulties, a period of relative stability might materialise by 2024, according to Moody’s.That follows a series of recent cuts to India’s gross domestic product growth forecasts for this year.Indeed, last month the International Monetary Fund (IMF) cut its projection of India’s economic growth in 2022 to 6.8 per cent from 7.4 per cent previously, as it joined other global agencies in trimming their forecasts.Still, despite those cuts in predictions, India remains the world’s largest growing economy.While the Indian economy was expected to grow at a faster pace than in many other economies, it would still be too slow to provide the number of jobs necessary to lift tens of millions of people out of poverty in a nation that is frequently ranked among the worst in the world for hunger.But the deteriorating outlook could be lowered further as a slowdown in the global economy raises the possibility of more declines in the coming months.The recent downgrades to the growth outlook are not limited to India; the predictions for the global economy and other major countries, too, have been slashed, with outright recession expected in some leading economies.Just when the world economy was recovering from the disruptions caused by the pandemic, a war on the edge of Europe pushed up global inflation and resulted in every major central bank adopting an aggressive rate hike policy.Higher borrowing costs from elevated inflation worldwide have disrupted economic activity further this year.Featured Video Of The DayTech Stocks Fall After Q3 Results; Meta, Amazon Lose Big
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