Goldman Sachs cuts India's FY 2010 GDP forecast

Goldman Sachs cuts India's FY 2010 GDP forecast

Goldman
Sachs has cut India's GDP growth forecast for the fiscal year 2010
(year ending March 2010) to 7.2% from 8.2% earlier due to a weak
investment outlook on account of rising interest rates. It has,
however, kept growth forecast for FY 2009 (year ending March 2009)
unchanged at 7.8% as it reckons that fiscal stimulus by the government
such as greater spending on a rural employment scheme, a debt waiver to
farmers, and wage hike to government employees, will bolster demand and
growth.

Goldman has revised FY 2009 inflation forecast upwards to
11.5% from 10% earlier. It has also raised FY 2010 inflation forecast
to 5.3% from 4.7% earlier.