Has Bank of America Increased India's GDP Growth Projections to 7.6% for the Current Fiscal Year and 6.8% for FY27?
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Synopsis
Bank of America has raised India's GDP growth outlook to 7.6% for FY26, boosted by policy reforms and economic consumption trends. This significant upgrade reflects positive indicators in the country's economic activity and suggests sustained growth momentum moving forward.
Key Takeaways
- GDP Growth Projection: Increased to 7.6% for FY26.
- FY27 Estimate: Upgraded to 6.8%.
- Policy Support: A key driver for future growth.
- Positive Indicators: Consumption and investment data trending upward.
- Government Updates: New GDP series to be released in February.
New Delhi, Jan 5 (NationPress) As the Indian economy continues to thrive due to strong policy reforms and robust consumption, Bank of America (BofA) has elevated the nation’s GDP growth forecast to 7.6 percent for the current fiscal year (FY26), an increase from the previous estimate of 7 percent.
Additionally, BofA has revised its GDP projection for fiscal year 2027 to 6.8 percent, up from the earlier estimate of 6.5 percent for FY27.
The global brokerage firm mentioned in its latest report that the incoming data from India “demands a GDP forecast upgrade,” as it reflects widespread enhancements in the country’s economic performance towards the close of 2025.
India’s growth outlook has improved following an unexpected 8.2 percent growth rate recorded in the second quarter, prompting a rise in growth estimates for 2025-26. The Reserve Bank of India (RBI) has also adjusted its GDP growth forecast for the economy to 7.3 percent.
The BofA report indicates that policy support is anticipated to be a significant theme moving forward, playing a crucial role in enhancing growth.
The economy has continuously benefited from a favorable monetary policy, with the Reserve Bank of India, led by Governor Sanjay Malhotra, implementing several rate cuts in 2025. This supportive environment has allowed the country to maintain momentum alongside a broadly expansionary fiscal approach, as noted by the brokerage.
Furthermore, the BofA report highlights that consumption and spending have surged, along with stronger investment data.
High-frequency indicators, such as fuel consumption, automobile sales, and credit growth, have shown significant acceleration in November and December, reinforcing the decision to revise the near-term forecasts.
The government is preparing to unveil a new GDP series alongside an updated inflation series. The revised national accounts framework will include back-series data for 2022-23, 2023-24, and 2024-25, ensuring continuity and facilitating comparisons.
However, the government does not anticipate a major alteration in India’s GDP growth estimates following the release of the revised national accounts series in February next year.
Point of View
It's clear that Bank of America's upgraded GDP forecasts for India reflect the resilience of the economy amidst global challenges. The focus on policy support and consumption trends signals a promising trajectory for growth, reinforcing the nation's ability to adapt and thrive in an evolving economic landscape.
NationPress
08/01/2026
Frequently Asked Questions
What is the revised GDP growth projection for India by Bank of America?
Bank of America has raised India's GDP growth projection to 7.6% for the current fiscal year (FY26) and 6.8% for FY27.
What factors influenced the GDP growth upgrade?
The upgrade was influenced by strong policy reforms, robust consumption trends, and better-than-expected economic performance.
How has the Reserve Bank of India responded to economic growth?
The Reserve Bank of India has adjusted its GDP growth forecast to 7.3%, reflecting confidence in the economic recovery.
When will the government release the new GDP series?
The government is expected to release the new GDP series along with updated inflation data in February next year.
Is a significant change in GDP growth estimates expected after the new release?
The government does not anticipate a major change in GDP growth estimates following the release of the revised national accounts series.
