IMF Predicts Moderation in India's GDP Growth as Economy Stabilizes

India's GDP growth is predicted to ease from 8.2% in 2023 to 7% in 2024 and 6.5% in 2025 as pent-up demand from COVID diminishes. The IMF's World Economic Outlook highlights that global inflation is being controlled while projecting steady global growth amid challenges for low-income countries.

The International Monetary Fund (IMF) forecasts a moderation in India's GDP growth, from 8.2% in 2023 to 7% in 2024 and further to 6.5% in 2025. The slowdown is attributed to the depletion of pent-up demand accumulated during the COVID-19 pandemic, as the economy realigns with its potential.

Globally, the IMF reports that inflationary pressures are being tamed, although certain nations continue to experience persistent price pressures. Headline inflation, which peaked at 9.4% in 2022, is projected to decrease to 3.5% by 2025, falling below the pre-2020 average.

The World Economic Outlook projects consistent global growth at 3.2% through 2024 and 2025. However, low-income and developing countries face significant growth challenges. IMF Chief Economist Pierre-Olivier Gourinchas highlighted these setbacks as linked to escalating regional conflicts and potential shifts in trade and industrial policies.

(With inputs from agencies.)