Nomura cuts India FY27 GDP growth forecast to 7 per cent

Key facts

• Nomura has revised India's Gross Domestic Product (GDP) growth forecast for fiscal year 2026-27 (FY27) downwards to 7.0 per cent from the earlier estimate of 7.1 per cent.
• The Consumer Price Index (CPI) inflation forecast for FY27 has been raised by 0.7 percentage points to 4.5 per cent due to rising energy costs.
• The Current Account Deficit (CAD) forecast for FY27 has been increased by 0.4 percentage points to 1.6 per cent of the GDP.
• Nomura expects India's GDP growth for FY26 to reach 7.6 per cent before the projected slowdown in the subsequent year.
• The International Energy Agency (IEA) has agreed to release 400 million barrels from emergency oil reserves, marking its largest-ever discharge to stabilise energy prices.
• Oil production in the southern fields of Iraq has declined from 3.3 million barrels per day (b/d) to 1.3 million b/d due to storage constraints and conflict.
• Rabobank International projects Brent crude oil prices to average 90 dollars per barrel in the second quarter (Q2) of 2026.
• Nomura notes that every 10 per cent increase in oil prices could potentially add 0.5 percentage points to India's inflation if costs are passed through to consumers.