ANZ turns bullish on India: Raises FY27 growth forecast, sees rate hikes in August
India's economy expanded 7.8 per cent in the March quarter and grew 7.7 per cent in FY26. ANZ expects growth to rise further to 6.9 per cent in FY28
- Jun 23, 2026,
- Updated Jun 23, 2026 1:49 PM IST
Australian banking major ANZ has raised its forecast for India's economic growth in FY27 to 6.7 per cent from 6.4 per cent earlier, citing resilient domestic demand, easing energy-related risks and lower crude oil prices.
In a report, ANZ economist Dhiraj Nim said the decline in Brent crude prices and the possibility of the Strait of Hormuz reopening have improved India’s near-term economic outlook, Informist reported on Tuesday.
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"Lower Brent crude prices and the possible reopening of the Strait of Hormuz support a more positive view of India's economic outlook," Nim said. However, he cautioned that any reassessment would remain measured until a final US-Iran peace agreement is reached and oil supplies fully normalise.
The revised forecast is slightly above the Reserve Bank of India’s projection of 6.6 per cent growth for FY27. The RBI had cut its growth estimate by 30 basis points earlier this month.
India's economy expanded 7.8 per cent in the March quarter and grew 7.7 per cent in FY26. ANZ expects growth to rise further to 6.9 per cent in FY28.
Must Read: The price we pay: How India can reduce its huge dependence on imports
Energy shock risks receding
According to ANZ, concerns over higher energy prices had emerged as a major threat to private investment by raising input costs and creating demand uncertainty.
"The energy price shock – now likely past its worst – had been a key risk to FY27 private investment through margin pressure and demand uncertainty. As prospects for a resolution to the US-Iran conflict improve, these headwinds should ease, lending support to sentiment amid firm domestic demand," Nim noted.
Two RBI rate hikes are expected
With inflation expected to stay elevated, ANZ now sees the case for tighter monetary policy strengthening.
“India's shifting macro backdrop raises the case for moderate rate hikes, in our view,” Nim said.
The bank expects the RBI to raise the repo rate by 25 basis points each in August and October, though it said the timing would remain dependent on incoming economic data.
ANZ argued that keeping rates unchanged while inflation rises could push real policy rates and real returns for savers below 1 per cent.
Earlier this month, the RBI’s Monetary Policy Committee left the repo rate unchanged at 5.25 per cent, preferring to assess the impact of developments in West Asia.
(With inputs from Informist)
Australian banking major ANZ has raised its forecast for India's economic growth in FY27 to 6.7 per cent from 6.4 per cent earlier, citing resilient domestic demand, easing energy-related risks and lower crude oil prices.
In a report, ANZ economist Dhiraj Nim said the decline in Brent crude prices and the possibility of the Strait of Hormuz reopening have improved India’s near-term economic outlook, Informist reported on Tuesday.
Don't Miss: Will RBI keep repo rate steady despite interim US-Iran peace deal? What we know
"Lower Brent crude prices and the possible reopening of the Strait of Hormuz support a more positive view of India's economic outlook," Nim said. However, he cautioned that any reassessment would remain measured until a final US-Iran peace agreement is reached and oil supplies fully normalise.
The revised forecast is slightly above the Reserve Bank of India’s projection of 6.6 per cent growth for FY27. The RBI had cut its growth estimate by 30 basis points earlier this month.
India's economy expanded 7.8 per cent in the March quarter and grew 7.7 per cent in FY26. ANZ expects growth to rise further to 6.9 per cent in FY28.
Must Read: The price we pay: How India can reduce its huge dependence on imports
Energy shock risks receding
According to ANZ, concerns over higher energy prices had emerged as a major threat to private investment by raising input costs and creating demand uncertainty.
"The energy price shock – now likely past its worst – had been a key risk to FY27 private investment through margin pressure and demand uncertainty. As prospects for a resolution to the US-Iran conflict improve, these headwinds should ease, lending support to sentiment amid firm domestic demand," Nim noted.
Two RBI rate hikes are expected
With inflation expected to stay elevated, ANZ now sees the case for tighter monetary policy strengthening.
“India's shifting macro backdrop raises the case for moderate rate hikes, in our view,” Nim said.
The bank expects the RBI to raise the repo rate by 25 basis points each in August and October, though it said the timing would remain dependent on incoming economic data.
ANZ argued that keeping rates unchanged while inflation rises could push real policy rates and real returns for savers below 1 per cent.
Earlier this month, the RBI’s Monetary Policy Committee left the repo rate unchanged at 5.25 per cent, preferring to assess the impact of developments in West Asia.
(With inputs from Informist)