Moody's cuts CY22 India GDP growth forecast to 8.8% amid rising inflation

Says rise in crude, food, and fertiliser prices will weigh on household spending

Moody’s Investors Service on Thursday lowered its gross domestic product (GDP) growth forecast for India to 8.8 per cent for calendar year 2022 (CY22) from its March estimate of 9.1 per cent, holding that rising inflation and interest rates will temper the economic growth momentum.

“The rise in crude oil, food, and fertiliser prices will weigh on household finances and spending in the months ahead. Rate increases to prevent energy and food inflation from becoming more generalised will slow the demand recovery’s momentum,” the rating agency said in its latest Global Macro Outlook.

However, Moody’s added that unless global crude oil and