Its outlook stays bright, backed by a sustained strengthening of macroeconomic fundamentals, robust financial and corporate sectors and a resilient external sector, the central bank noted.

India’s real gross domestic product (GDP) growth accelerated to 7.6 per cent in fiscal 2023-24 (FY24) from 7 per cent in the previous fiscal—the third successive year of growth of 7 per cent or above. The economy showed resilience in FY24 despite persistent headwinds, it noted.

The easing of supply chain pressures, broad-based softening in core inflation and early indications of an above normal southwest monsoon augur well for the inflation outlook in FY25, the central bank said in the report.

Headline inflation moderated by 1.3 percentage points on an annual average basis to 5.4 per cent in FY24. The volatility in international crude oil prices, the persisting geopolitical tensions and elevated global financial market volatility also pose upward risk to the inflation trajectory.

Fibre2Fashion News Desk (DS)