Reserve Bank of India Raises FY27 GDP Forecast to 6.7% Amid Strong Domestic Demand

Reserve Bank of India revised its FY27 GDP growth forecast to 6.7%, up from 6.6% in the earlier estimate, citing stronger domestic demand and resilient manufacturing output, as reported in the latest monetary policy review.

Malhotra & Co analysts noted the 0.1 percentage point lift is driven by a 1.8% rise in manufacturing output and a 2.3% rebound in services spending, reflecting improved export orders and domestic consumption.

GDP forecast aligns with the RBI's medium‑term target range of 6.5% to 7.5%, reinforcing confidence that the economy will sustain growth momentum despite global headwinds and commodity price volatility.

Implications for market participants include potential for higher corporate earnings, a steady interest rate path, and continued support for the rupee, as the RBI signals no immediate rate cuts while monitoring inflation and credit growth.