IMF: India drives global growth, ceasefire improves outlook

The International Monetary Fund said India remains a major engine of global economic growth, forecasting 6.5% real GDP expansion in fiscal year 2026‑27 after the economy grew 7.8% in the first quarter of the calendar year. IMF officials highlighted strong domestic demand and reduced U.S. tariffs as supports, while noting that higher energy prices and supply disruptions from the Middle East conflict have affected India as a large energy importer.

The IMF added that a cease‑fire in the Middle East and progress toward reopening the Strait of Hormuz have eased immediate risks to the global economy. Oil prices have fallen from their peaks but stay about 10% above pre‑war levels, and other commodity prices have also declined. Inflation expectations remain anchored and financial conditions stay accommodative, according to IMF communications director Julie Kozack, who said the institution will provide a full update in its World Economic Outlook on July 8.