Goldman Sachs Cuts India 2026 Growth Forecast to 5.9%

Key facts

• Goldman Sachs has lowered India’s 2026 growth forecast to 5.9% from its pre-Iran war estimate of 7%.
• The bank predicts a 50 basis points increase in policy rates by the Reserve Bank of India (RBI) due to currency depreciation pressures.
• India’s inflation is projected to rise to 4.6% in 2026 from an earlier forecast of 3.9%, while remaining within the RBI target range of 2-6%.
• The Current Account Deficit (CAD) of India is projected to widen to 2% of Gross Domestic Product (GDP) in 2026 from 1.3% in the October-December 2025 period.
• Retail inflation in India rose to 3.21% year-on-year in February from 2.74% in January.
• The RBI kept the benchmark repo rate unchanged at 5.25% during its February meeting.
• Brent crude prices are projected to average $105 per barrel in March and $115 in April before declining to $80 per barrel in the fourth quarter of the year.
• Growth forecasts for other economies were revised to 4.7% for China, 1.9% for South Korea, and 1.8% for Hong Kong.
• The Monetary Policy Committee (MPC) of the RBI is scheduled to meet earlier next week.