The International Monetary Fund upgrades India’s growth outlook and cuts inflation projection to 2.8%, citing strong domestic demand and services exports
The International Monetary Fund (IMF) has revised India’s GDP growth forecast for FY26 to 6.6%, up from its earlier estimate of 6.4% in July, reaffirming India’s position as the world’s fastest-growing major economy.
In its October World Economic Outlook report, the IMF noted that India’s robust economic momentum is driven by rising domestic consumption, a surge in services exports, and resilient performance in early 2025–26. India recorded an impressive 7.8% growth in the first quarter of FY26, the highest in the past year, and is expected to maintain around 7% in the second quarter.
The World Bank and the Reserve Bank of India have also raised their forecasts to 6.5% and 6.8% respectively, attributing the strength to strong consumer demand and effective GST reforms.
Significantly, the IMF has reduced India’s inflation outlook to 2.8% for FY26, down from 4.2%, reflecting easing price pressures and record-low retail inflation at 1.54% in September , the lowest in eight years.
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