The Reserve Bank of India’s (RBI) latest Survey of Professional Forecasters (SPF) has raised both real GDP growth and retail inflation projections for FY27 by 10 basis points (bps), while its FY28 forecasts suggest that the economy could move closer to a “Goldilocks” phase of steady growth and moderating inflation.The RBI’s 101st SPF, conducted in July 2026, pegged FY27 real GDP growth at 6.6 per cent, up from 6.5 per cent projected in the 100th SPF conducted in May 2026.At the same time, it increased the retail inflation forecast by 10 bps to 5 per cent from 4.9 per cent.In its bi-monthly monetary policy review on August 5, the RBI also revised its FY27 growth forecast upwards by 10 bps to 6.7 per cent. However, it lowered its retail inflation projection by 10 bps to 5 per cent.As a result, the RBI’s growth projection for FY27 is now 10 bps higher than that of the SPF, while both have converged on the same inflation estimate.Growth drivers and Inflation concernsIn his monetary policy statement on August 5, RBI Governor Sanjay Malhotra noted that economic growth continues to be supported by resilient domestic demand, sustained expansion in manufacturing and services, and robust exports, reaffirming India’s position as the world’s fastest-growing major economy.“Even though headline inflation is projected to increase, it is primarily on account of supply-side pressures arising from food and fuel prices and is not becoming broad-based. Core inflation remains moderate and is expected to decline after peaking in the third quarter. Growth, while resilient, is expected to be somewhat lower in 2026-27,” he said.Malhotra cautioned that the outlook remains uncertain due to factors such as the south-west monsoon, El Nino conditions, geopolitical developments and global trade policy.“There is a need for greater clarity, especially regarding inflation, its trajectory and composition, before taking any policy action,” he added.FY28 outlookThe latest SPF raised its FY28 real GDP growth forecast by 10 bps to 7 per cent, compared with 6.9 per cent in the previous survey. Meanwhile, it retained the retail inflation projection at 4.5 per cent.The revised FY28 forecasts indicate a near “Goldilocks” scenario, with economic growth remaining robust while inflation gradually moves closer to the Monetary Policy Committee’s medium-term target of 4 per cent.The International Monetary Fund (IMF), in its July 2026 World Economic Outlook update, lowered India’s FY27 growth forecast to 6.4 per cent from 6.5 per cent projected in April 2026. However, it raised its FY28 growth estimate to 6.7 per cent from 6.5 per cent earlier.External sector improvesThe SPF has revised FY27 merchandise export growth upwards to 7 per cent, from 5 per cent estimated earlier. Merchandise imports are now projected to grow at a slower pace of 9.9 per cent, compared with 10.5 per cent in the previous survey.Reflecting these revisions, the current account deficit (CAD) for FY27 is now expected to narrow to 1.4 per cent of GDP at current market prices, significantly lower than the earlier projection of 2.1 per cent.For FY28, the CAD estimate has also been revised marginally lower to 1.1 per cent of GDP, compared with 1.2 per cent projected previously.Published on August 9, 2026