Now Reading: SBI Research sees 7% Q1 growth, ICICI warns of H2 moderation
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SBI Research sees 7% Q1 growth, ICICI warns of H2 moderation
India's economy is likely to grow around 7% in the first quarter of FY27, according to an SBI Research report. The Reserve Bank of India's projection of 7.3% growth for Q1 FY27 signals an improving trajectory heading into FY28, supported by a recovery in underlying demand.
However, ICICI Bank expects growth to moderate in the second half of FY27 due to a high base effect, with full-year FY27 growth likely at 6.9% before accelerating to 7.2% in FY28. The Monetary Policy Committee kept the repo rate unchanged at 5.25% with a neutral stance, while the RBI sees risks to both growth and inflation as evenly balanced.
ICICI Bank noted that if core inflation stays above target, a 50 basis point rate hike cycle could begin between December 2026 and April 2027, depending on oil prices.
Indian Opinion Analysis
The SBI Research report (source-1) leads with a headline figure of "around 7%" for Q1 FY27, presenting an upbeat, forward-looking growth story with no caveats about H2 moderation or policy risks. ICICI Bank's report (source-2) offers a more granular, cautious view: it flags a likely H2 slowdown due to base effects, and discusses the possibility of rate hikes. Source-2's framing is more critical of the growth trajectory's sustainability, while source-1 is neutral-report, sticking to the headline. A careful reader should note that source-2's 6.9% full-year FY27 estimate is lower than the Q1 7.3% RBI projection, implying considerable H2 deceleration. The key number to watch is core inflation: if it stays above target, a 50 bps rate hike cycle could begin between December 2026 and April 2027.
Coverage: 2 sources, 1 government-critical, 1 neutral
Sources (2): newsonair.gov.in (neutral report), m.economictimes.com (government critical)
This story was synthesised by AI from the 2 sources linked above. Methodology and corrections.
Updated: this story now draws on 2 sources.
