“In India, growth momentum remains strong, and while we think core inflation will bottom out in April-June, we expect it to be around 4-4.5 per cent in July-December,” Goldman Sachs said. The country’s core inflation averaged 3.4 per cent year on year (YoY) between January and April this year.
Goldman Sachs recently revised its forecast for India’s GDP for this year by 10 basis points (bps) to 6.7 per cent, expecting a sustained growth momentum.
It thinks core inflation will bottom out in April-June, and expects it to be around 4-4.5 per cent in July-December.
It also expects the Reserve Bank of India to cut interest rates in Q4 2024.
Projecting an uptick in core goods inflation due to a rise in manufacturing costs, the global financial institution expects the Reserve Bank of India (RBI) to cut interest rates in the fourth quarter (Q4) this year.
“We continue to expect a shallow easing cycle of total 50 bps rate cuts from the RBI, with 25 bps rate cuts each in October-December and January-March 2025,” it said.
Goldman Sachs also expects two rate cuts by the US Federal Reserve, in September and December this year.
Fibre2Fashion News Desk (DS)
