India's economy grew 7.8% in Jan-March as oil risks cloud outlook
What's next: The RBI now sees fiscal 2027 growth at 6.6% and inflation at 5.1% as the Iran war lifts energy costs.
India's economy expanded 7.8% from a year earlier in the January-March quarter, beating a Reuters forecast of 7.2% and matching the previous quarter's pace. The stronger reading came even as the period was partly hit by disruption from the Middle East conflict. The Reserve Bank of India on Friday cut its growth forecast for the financial year ending March 2027 to 6.6% from 6.9% and raised its inflation projection to 5.1% from 4.6%. Higher energy import costs tied to the Iran war have increased pressure on the rupee after record foreign investor outflows. The government also passed global fuel price increases on to consumers in May, adding to inflation risks even as April inflation stayed below the RBI's 4% target.