S&P retains Indias GDP progress forecast at 6.5% on robust home demand

S&P Global Ratings on Tuesday (September 23, 2025) retained India’s GDP progress forecast at 6.5% within the present fiscal, citing robust home demand amid a largely benign monsoon.

S&P additionally stated it expects a 25 bps fee lower by the RBI this fiscal because it revised its inflation forecast down to three.2% for this fiscal 12 months.

India’s GDP grew at 7.8% within the April-June quarter.

“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 stated in a press release.

S&P stated a sharper-than-expected lower in meals inflation will assist maintain inflation low within the present 12 months.

“This leaves room for further monetary policy adjustments, and we anticipate a 25 bps rate cut by the Reserve Bank of India this fiscal year,” S&P added.

In its Economic Outlook Asia-Pacific This fall 2025: Growth To Ease On External Strain report, S&P stated that throughout the area, comparatively resilient home demand ought to dampen the affect from stronger exterior headwinds following the rise in US import tariffs and slower world progress.

U.S. tariffs on imports from completely different Asian economies will form each their export outlook and their function in regional provide chains.

“Relative to our June assumptions on US tariffs, China has so far fared somewhat better than other Asian economies, and Southeast Asian emerging markets somewhat worse. India has been hit much harder than expected,” S&P stated.