Mumbai: India may expand at a slower pace in the current financial year that began in April than initially thought and there are more rate cuts in the pipeline, a survey of 17 forecasters conducted by the central bank showed on Thursday.
The survey is conducted by the Reserve Bank of India every quarter since September 2007 and does not reflect its views.
Forecasters have cut their 2009-10 growth forecast to 5.7% from 6%.
At a review in April, where it cut its main lending rate by 25 basis points to 4.75% , the central bank pencilled in 2009-10 growth at 6%.
The survey expects the central bank to cut its main lending rate to 4.5% and its main borrowing rate or the reverse repo rate to 3% by the end of current financial year. The reverse repo rate now stands at 3.25%.
The survey expects wholesale price inflation on a year-on-year basis in the first quarter of 2009-10 to fall to -1.4% from an earlier estimate of 2.4%.
Latest data showed headline inflation in early May at 0.48%, below previous week’s rise of 0.70%.
The central government’s fiscal deficit is expected to widen to 6.2% of GDP in 2008-09, whereas the combined gross fiscal deficit is likely to come in at 9.8%, the survey showed.
Both these figures have been revised upwards from 5% and 8%, respectively, in the last survey.