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S&P noted that China is better positioned and India’s condition is worse. “US tariffs on imports from different Asian economies will matter for their export outlook and their role in regional supply chains. Compared to our June assumptions, China has so far come out a bit better, relative to other Asian economies, and Southeast Asian emerging markets a bit worse. India has come out significantly worse, and the region’s developed economies broadly unchanged,” it noted
S&P expects RBI rate cut by 25 bps this fiscal
In the report S&P also said it expects a 25 bps rate cut by the RBI this fiscal as it revised its inflation forecast down to 3.2 per cent for this fiscal year. The Reserve Bank of India (RBI) is scheduled to meet for its fourth meeting on Sept 29–Oct 1.
The rating agency also retained India’s GDP growth forecast at 6.5 per cent in the current fiscal, citing strong domestic demand amid a largely benign monsoon.
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“We forecast India’s GDP growth to hold steady at 6.5 per cent this fiscal year (year ending March 31, 2026). We expect domestic demand to remain strong, supported by a largely benign monsoon season, cuts in the income and the goods and services tax, and accelerating government investment,” S&P said in a statement.