According to the International Monetary Fund’s most recent World Economic Outlook (WEO) report, India’s economy is expected to increase by 6.4% in both FY2025-26 and FY2026-27. This marks a slight upward revision to the IMF’s previous estimates, reflecting stronger global conditions. The revision is due to a more favourable external environment than was anticipated in April.

For the current fiscal year, the IMF increased India’s GDP growth prediction by 20 basis points to 6.4%. The FY27 projection was also increased by 10 basis points, bringing it to the same level. The IMF now anticipates global growth to reach 3.0% in 2025, rising slightly to 3.1% in 2026. Factors driving this include front-loaded trade activities ahead of tariffs, improved financial conditions, and fiscal expansion in select major economies.

Emerging and developing markets are expected to rise moderately, at 4.1% in 2025 and 4.0% in 2026. Global inflation is anticipated to fall to 4.2% in 2025 and 3.6% by 2026. However, inflation in the United States is anticipated to stay above the central bank’s target.