Latest news with #pre-COVID
Indian Express
11 hours ago
- Business
- Indian Express
IMF upgrades India's FY26 GDP growth forecast to 6.4% as trade tensions ease
The International Monetary Fund (IMF) on Tuesday raised its Gross Domestic Product (GDP) growth forecast for India to 6.4 per cent for both 2025-26 and 2026-27 on account of easing global trade tensions, with the world economy also seen expanding at a slightly faster pace than what the multilateral organisation had predicted in April. 'In India, growth is projected to be 6.4 per cent in 2025 and 2026, with both numbers revised slightly upward, reflecting a more benign external environment than assumed in the April reference forecast,' the IMF said in an update to its World Economic Outlook report, referring to India's fiscal years that begin in 2025 and 2026. According to non-partisan policy research center The Budget Lab at Yale, US consumers faced an overall average effective tariff rate of 18.2 per cent as on July 28, down from 28 per cent on April 9. India's GDP is estimated to have increased by 6.5 per cent in 2024-25, the lowest growth rate in four years. The Reserve Bank of India (RBI), meanwhile, expects the GDP to grow by another 6.5 per cent in the current fiscal, with the Indian finance ministry estimating it in the range of 6.3-6.8 per cent. For 2026-27, the RBI on April 9 had forecast a growth rate of 6.7 per cent. Back in April, the IMF had cut its growth forecasts for India by 30 basis points (bps) to 6.2 per cent for 2025-26 and by 20 bps to 6.3 per cent for 2026-27 due to 'higher levels of trade tensions and global uncertainty'. Since then, the tariff war waged by the US has eased somewhat, with IMF Chief Economist Pierre-Olivier Gourinchas calling the Trump administration's April actions an 'unprecedented escalation'. Moreover, global financial conditions have eased and the US dollar has weakened around 8 per cent since January, allowing the IMF to now project that the global GDP will grow 3 per cent in 2025 and 3.1 per cent in 2026, up from 2.8 per cent and 3 per cent, respectively, predicted in April. However, the IMF continued to warn that while the 'modest decline in trade tensions' had contributed to the resilience of the global economy, tariffs remain 'historically high' and global policy remains highly uncertain, with risks to the world 'firmly to the downside'. '…compared to our pre-April 2 forecast, global growth is revised downwards by 0.2pp (0.2 percentage points) this year. At around 3 per cent, global growth remains disappointingly below pre-COVID average. And we continue to project a persistent decline in global trade as a share of output despite the recent frontloading, from 57 per cent in 2024 to 53 per cent in 2030,' Gourinchas said. One percentage point is equal to 100 basis points. The other countries expected by the IMF to grow at a faster pace now in both 2025 and 2026 include the US, Canada, China, Brazil, Saudi Arabia, and Nigeria. China, in fact, received the largest growth forecast upgrade by the IMF, with its GDP now seen expanding 4.8 per cent in 2025, up from 4 per cent predicted in April. 'This revision reflects stronger-than-expected activity in the first half of 2025 and the significant reduction in US–China tariffs. The GDP outturn in the first quarter of 2025 alone implies a mechanical upgrade to the growth rate for the year of 0.6 percentage point. A recovery in inventory accumulation is expected to partly offset payback from front-loading in the second half of 2025. Growth in 2026 is also revised upward by 0.2 percentage point to 4.2 per cent, again reflecting the lower effective tariff rates,' the IMF said. China's GDP grew 5.4 per cent and 5.2 per cent in the first two quarters of 2025, beating forecasts, and keeping the world's second largest economy on track to meet the government's full-year growth target of 5 per cent. Siddharth Upasani is a Deputy Associate Editor with The Indian Express. He reports primarily on data and the economy, looking for trends and changes in the former which paint a picture of the latter. Before The Indian Express, he worked at Moneycontrol and financial newswire Informist (previously called Cogencis). Outside of work, sports, fantasy football, and graphic novels keep him busy. ... Read More
New Straits Times
17 hours ago
- Business
- New Straits Times
BMI maintains positive outlook for consumer spending in Malaysia over 2025, 2026
KUALA LUMPUR: BMI, a Fitch solutions company, has maintained its broadly positive outlook for consumer spending in Malaysia over 2025, with the country's healthy macroeconomic outlook driving real terms growth in household incomes. With inflation averaging lower than expected in May, BMI lowered its forecast for headline inflation to an average of 1.9 per cent year-on-year (y-o-y) in 2025, down from 2.1 per cent previously, and only slightly up from an average of 1.8 per cent in 2024. It noted this remained low enough to support household purchasing power. Overall, the firm forecasted household spending to grow by 3.8 per cent y-o-y over 2025, in real terms, to a value of RM930.7 billion, up from RM896.9 billion in 2024. "As a result, household spending has returned close to pre-COVID levels of growth, where it grew at a real average rate of 5.2 per cent y-o-y during the 2015-2019 period. "However, spending will continue to be restrained by Malaysian consumers' high levels of indebtedness and the correspondingly high debt servicing costs," it said in its latest "Malaysia Consumer Outlook: Strong Growth Forecast Over 2025 and 2026". Looking ahead to 2026, BMI expected consumer spending to accelerate, underpinned by strong gross domestic product growth and a stable employment outlook. It said consumer confidence and willingness to spend would be further supported by a stable inflationary environment and the Bank Negara Malaysia returning to a loosening mode, cutting its benchmark interest rate by a further 25 basis points from a forecast of 2.75 per cent in December 2025 to 2.50 per cent by end-2026. "Across the year, therefore, we forecast total household spending growth in Malaysia of 5.0 per cent y-o-y in real terms, taking spending to RM977.3 billion," it said. BMI said that over the 2025-2029 forecast period, solid household incomes and tourism-related retail sales would further support a steady uptick in spending.
The Star
19 hours ago
- Business
- The Star
BMI maintains positive outlook for consumer spending in Malaysia over 2025, 2026
KUALA LUMPUR: BMI, a Fitch solutions company, has maintained its broadly positive outlook for consumer spending in Malaysia over 2025, with the country's healthy macroeconomic outlook driving real terms growth in household incomes. With inflation averaging lower than expected in May, BMI lowered its forecast for headline inflation to an average of 1.9 per cent year-on-year (y-o-y) in 2025, down from 2.1 per cent previously, and only slightly up from an average of 1.8 per cent in 2024. It noted this remained low enough to support household purchasing power. Overall, the firm forecasted household spending to grow by 3.8 per cent y-o-y over 2025, in real terms, to a value of RM930.7 billion, up from RM896.9 billion in 2024. "As a result, household spending has returned close to pre-COVID levels of growth, where it grew at a real average rate of 5.2 per cent y-o-y during the 2015-2019 period. "However, spending will continue to be restrained by Malaysian consumers' high levels of indebtedness and the correspondingly high debt servicing costs,' it said in its latest "Malaysia Consumer Outlook: Strong Growth Forecast Over 2025 and 2026'. Looking ahead to 2026, BMI expected consumer spending to accelerate, underpinned by strong gross domestic product growth and a stable employment outlook. It said consumer confidence and willingness to spend would be further supported by a stable inflationary environment and the Bank Negara Malaysia returning to a loosening mode, cutting its benchmark interest rate by a further 25 basis points from a forecast of 2.75 per cent in December 2025 to 2.50 per cent by end-2026. "Across the year, therefore, we forecast total household spending growth in Malaysia of 5.0 per cent y-o-y in real terms, taking spending to RM977.3 billion,' it said. BMI said that over the 2025-2029 forecast period, solid household incomes and tourism-related retail sales would further support a steady uptick in spending. - Bernama
Barnama
21 hours ago
- Business
- Barnama
BMI Maintains Positive Outlook For Consumer Spending In Malaysia Over 2025, 2026
BUSINESS KUALA LUMPUR, July 29 (Bernama) -- BMI, a Fitch solutions company, has maintained its broadly positive outlook for consumer spending in Malaysia over 2025, with the country's healthy macroeconomic outlook driving real-term growth in household incomes. With inflation averaging lower than expected in May, BMI lowered its forecast for headline inflation to average at 1.9 per cent year-on-year (y-o-y) in 2025, down from 2.1 per cent previously, and only slightly up from an average 1.8 per cent in 2024. It added that this remained low enough to support household purchasing power. "Overall, we forecast household spending to grow by 3.8 per cent y-o-y over 2025 in real terms to RM930.7 billion, up from MYR896.9 billion in 2024. "As a result, household spending has returned close to pre-COVID levels of growth, where it grew at a real average rate of 5.2 per cent y-o-y during the 2015-2019 period. "However, spending will continue to be restrained by Malaysian consumers' high levels of indebtedness and the correspondingly high debt servicing costs," it said in its 'Malaysia Consumer Outlook: Strong Growth Forecast Over 2025 and 2026' commentary today. Looking ahead to 2026, BMI expect consumer spending to accelerate, underpinned by strong gross domestic product (GDP) growth and a stable employment outlook. Consumer confidence and willingness to spend would be further supported by a stable inflationary environment and Bank Negara Malaysia (BNM) back in loosening mode, cutting its benchmark interest rate by a further 25 basis points from a forecast 2.75 per cent in December 2025 to 2.50 per cent by end-2026. "Therefore, we forecast total household spending growth to be at 5.0 per cent y-o-y in real terms for 2025, taking spending to RM977.3 billion," it said.
Mint
4 days ago
- Business
- Mint
How Indian airlines are benefiting from Look East Policy
For years, successive governments have had the 'Look East' policy to work with the South East Asian nations and offer a counterbalance to China's influence in the region. In 2014, this 'Look East' was converted to 'Act East' with a focus on economic connections, defence co-operation, and most importantly, people-to-people connect. The people-to-people connect part has greatly benefited the airlines, with the winners being Indian carriers in some cases, while foreign carriers in others. The change has been drastic from pre-COVID times to today and has been fuelled by the need from ASEAN to replace or hedge Chinese tourists, who remained away for a longer period due to restrictions in place by the Chinese government on travel. This meant that tourism-heavy economies like Thailand started offering incentives like free visas for Indians to travel, leading to a spurt in tourist traffic. Overall, the India-ASEAN market has been a mix of new connections, increased services and a growth like no other. Data obtained from Cirium, an aviation analytics company, exclusively for this article, shows that there has been a giant leap in connectivity, with Indian carriers also benefiting from this. In December 2019, the last full month of operations in the world before COVID started taking its toll, India did not have a connection with Brunei, Laos, the Philippines and Cambodia among the 10 ASEAN nations. Today, Royal Brunei operates a thrice-a-week service to Chennai; Air Cambodia flies twice a week to Delhi; Air India is starting flights to Manila in September while Laos remains the only blank spot right now. Among all the countries and connectivity, the India-Vietnam connectivity has seen a new high. From just 21 flights a week in December 2019, the connectivity has now gone up to 82 weekly flights. However, only 21 out of these are operated by Indian carriers — 14 by IndiGo and seven by Air India. The rest are being operated by the two Vietnamese carriers, Vietnam Airlines and VietJet. Their network in India has spanned to Ahmedabad, Mumbai, Bengaluru, Kochi, Delhi and Hyderabad to connect to Ho Chi Minh City and Hanoi, after having tried a few other variations. Overall, the seats went up nearly four times, and frequencies have gone up three times. While the India-Vietnam sector has seen the foreign carriers rule over Indian ones, the story is exactly opposite to Indonesia. By December 2019, all the Indonesian carriers had pulled out of India where multiple variations like non-stop and one-stop flights via Kuala Lumpur or Bangkok had been tried to connect Jakarta and Bali to points in India. On the other side of COVID, IndiGo and Vistara (later Air India) have 21 weekly frequencies to Indonesia, with IndiGo operating a daily flight to Jakarta from Mumbai and to Bali from Bengaluru while Air India operates to Bali from Delhi. The India-Malaysia market has remained more or less the same, with a slight drop. There are 42,124 weekly seats each way across 222 frequencies between India and Malaysia. While IndiGo reduced its presence at Kuala Lumpur, it added flights to Penang and Langkawi from Chennai and Bengaluru respectively, while Air India returned to Kuala Lumpur. The Malaysian carriers have shrunk 11 per cent even though they have tried multiple options having maxed out on seats to metros due to bilateral restrictions. The India-Singapore market comprises 57,611 weekly seats across 247 flights this August, a slump of 10 per cent compared to 2019. The Singaporean side has shrunk by 8 per cent since 2019, while the Indian side has remained constant. August also sees seasonal variations to Singapore and often sees drop in capacity by seats or frequencies. The biggest gainer for seats in the market between pre-COVID and today has been Thailand. This also is the biggest market among the three nations by seats on offer. There was an addition of 35 weekly frequencies and a growth of 10 per cent in connectivity between India and Thailand. The connectivity recalibrated with new points being connected, like Surat-Bangkok, Pune-Bangkok, Bhubaneshwar-Bangkok, Bengaluru-Krabi, Kolkata-Phuket, among others. The Indian carriers grew close to 25 per cent in the India-Thailand market, taking a fair share even after the fall of Go Air, while the Thai carriers shrank about 5 per cent. The total seats on offer each week between India and Thailand stands at 71,350. The people connect is driven by affordability and opening up of new connections, making it far easier to visit tourist destinations like Krabi, Phuket, Langkawi, Penang or Bali. The total cost, often a true measure of holiday expenditure, dictates the travel plans and Indonesia, Vietnam or Thailand stand out compared to the Maldives, where there was a diplomatic row last year, or European destinations which not only are expensive but also have challenges and lead time issues for visa. The strategic dependence on Indian tourism bodes well for the country as a whole, even when we struggle to attract as many foreigners and the international traffic is dominated by Indians travelling abroad.
