Anubhuti Sahay, Head of India Economic Research at Standard Chartered Bank, announced a downgrade of India's GDP growth forecast from 7.1% to 6.4%. This adjustment is attributed to elevated crude oil prices, which are expected to average $90 per barrel, and concerns over a potentially weak monsoon. Sahay noted that the ongoing conflict in the Middle East is influencing global oil prices, which could further impact India's economic indicators, including new project announcements and input costs for businesses.

The anticipated weak monsoon could lead to increased food inflation, complicating the economic landscape. Sahay mentioned that while some sectors like electricity and steel are performing well, the informal sector may face greater challenges, particularly as GDP data is released later this month.

Regarding monetary policy, Sahay indicated that the Reserve Bank of India (RBI) may face pressures to raise interest rates by 25-50 basis points to combat inflation, especially if the geopolitical situation continues to disrupt supply chains. Despite government efforts, the consumption cycle remains sluggish, primarily due to low-income growth and insufficient job creation in productive sectors.