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Fitch reaffirms India rating at BBB- with stable outlook; sees FY20 GDP growth at 4.6%

The ratings agency sees India’s FY20 and FY21 GDP growth at 4.6 percent and 5.6 percent, respectively

December 20, 2019 / 03:39 PM IST

Fitch has affirmed India’s  Long-Term Foreign-Currency Issuer Default Rating (IDR) ratings at 'BBB-' on December 20 with a stable outlook .

The ratings agency sees India’s FY20 and FY21 GDP growth at 4.6 percent and 5.6 percent, respectively. "We expect growth to gradually recover to 5.6 percent in FY21 and 6.5 percent in FY22 with support from easing monetary and fiscal policies and structural measures that may also support growth over the medium term," Fitch said in a statement.

Gita Gopinath, Chief Economist at the International Monetary Fund, said on December 17 that India's economic growth, which has been contracting for last several quarters, is likely to remain muted in the December and March quarters of FY20

Gopinath said GDP growth was expected to pick up in the last two quarters of FY20 but some high-frequency indicators show that a recovery is unlikely. "That is what is leading us to revaluate our assessment that was put out in October,” she stated.

The IMF will release a report on India's economic growth outlook on January 20, 2020, and is expected to cut the growth estimate for India 'significantly'.

On December 9, Raghuram Rajan warned that India is in the midst of a ‘growth recession’.

Moneycontrol News
first published: Dec 20, 2019 03:10 pm

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