Moody’s Analytics released the report titled India Outlook: Prospects Brighten in the second week of September 2014. In the report, it stated that India's growth prospects brightened with growth rate expected to accelerate to 5.2 percent in 2014 and 6.5 percent by end of 2015.
The report also stated that the downside risks have receded around the external sector and fiscal deficit but inflation remained high in the economy.
The above forecast came following the GDP growth touching a level of 5.7 percent in April-June 2014 quarter. This growth rate was witnessed after two years.
Moreover, Moody’s Analytics predicted that the Reserve Bank of India (RBI) will not cut the interest rates in 2014. It foresees an initial interest rate cut in the second quarter of 2015. However, it depends on the strength of the recovery, the monsoon rainfall and the subsequent path of inflation.
Recommendations of Moody’s Analytics in India Outlook: Prospects Brighten
The report by Moody’s Analytics suggested that the policymakers should have their eyes on the longer term gains rather than seeking short-term gains.
However, it recommended for more economic reforms in India. The reforms could help the economy in achieving 7-8 percent annual GDP growth sustainably.
Who: Moody's Analytics