Fitch cuts FY23 growth forecast to 8.5%, cites soaring energy prices

The rating agency said post-pandemic recovery is being hit by a potentially huge global supply shock that will reduce growth and push up inflation

Fitch Ratings on Tuesday downgraded its growth forecast for India by 180 basis points to 8.5 per cent for 2022-23, citing sharply higher energy prices. The extent of the downward revision in growth forecast for India is second only to Germany among major economies.   

Russia’s invasion of Ukraine and the economic sanctions on Russia have led to high energy prices, supply-chain disruptions, raw material shortages, and record inflation rates. The resultant deterioration of growth momentum led Fitch to cut its world gross domestic product (GDP) growth forecast for calendar year 2022 (CY22) by 0.7 percentage points to 3.5 per