Bad news for India's economic growth: Fitch slashes India GDP growth forecast

New Delhi, March 21: Fitch cuts India's economic growth forecast for next financial year to 6.8 per cent from 7 per cent forecast earlier, on weaker than expected momentum in the economy. In its Global Economic Outlook released in December 2018, Fitch had estimated India's GDP growth to be 7 per cent and 7.1 per cent in financial years 2019-20 and 2020-21 respectively."While we have cut our growth forecasts for the next fiscal year (FY20, ending in March 2020) on weaker-than-expected momentum, we still see Indian GDP growth to hold up reasonably well, at 6.8 per cent, followed by 7.1 per cent in FY21," Fitch said in its Global Economic Outlook.Fitch Ratings cut India's FY19 GDP growth forecast to 7.2 per cent from 7.8 per cent on December 6. The rating agency has also cut growth forecasts for FY20 and FY21 to 7 per cent from 7.3 per cent and 7.1 per cent from 7.3 per cent, respectively.According to Fitch, the RBI, has adopted a more dovish monetary policy stance and cut interest rates by 0.25 percentage at its February 2019 meeting, a move supported by steadily decelerating headline inflation."We have changed our rate outlook and we now expect another 25 bp cut in 2019, amid protracted below target inflation and easier global monetary conditions than previously envisaged," it said."On the fiscal side, the budget for FY20 plans to increase cash transfers for farmers," it added. Fitch said, it's benign oil price outlook and expectations of accelerating food prices in the coming months should support rural households' income and consumption.10:08  Sensex rises over 100 points on robust FII buying:  Rising for the ninth straight session, market benchmark BSE Sensex rose over 119 points in early trade Friday led by gains in banking, metal and auto stocks amid sustained foreign fund inflow.Gains were, however, capped tracking Asian markets as investors turned cautious after the US Federal Reserve kept interest rates unchanged, experts said.The 30-share index was trading 119.52 points, or 0.31 per cent, higher to 38,506.27. The index began the session on a firm note at 38,452.47 and hit the session's high of 38,526.71 on steady buying by foreign funds as well as retail investors.The NSE Nifty also advanced by 36.35 points, or 0.32 per cent, to 11,557.40. Major gainers were Bharti Airtel, L&T, Yes Bank, Tata Steel, NTPC, Asian Paint, Bajaj Auto, HDFC, Axis Bank and State Bank of India, rising up to 3.03 per cent.Among the losers in the Sensex pack, ITC, Reliance Industries, Maruti, M&M, TCS and ONGC down up to 1.75 per cent. Brokers said sustained foreign fund inflows and continued buying by retail investors influenced the market.Meanwhile, the rupee appreciated by 6 paise to 68.57 against the US dollar in opening trade.  -- PTI