India-US tariff war: Goldman Sachs trim India’s GDP growth output; Inflation forecast offers silver lining – times of India

The growthest of India can be on its way to a rough patch after the US President Donald Trump had imposed a steep “mutual” rate of 25% on Indian goods, a recent report from Goldman Sachs showed.In a new revised prospect, the brokerage has cut his prediction for the real GDP growth of India by 0.1 percentage point. It now expects the economy to grow by 6.5% in calendar year 2025 and with 6.4% in 2026, which is reduced by a 0.2 percentage point from previous projections.“In our opinion, some of these rates are likely to be negotiated over time, and a further downward risk for the growth process is mainly due to the uncertainty channel,” said the report, as quoted by Ani.Even if it is predicted that growth will slow down, there is a silver lining on the inflation front. The company lowered India’s inflation forecasts by 0.2 percentage points for both calendar year 2025 and tax year 2026, where it was now 3.0% on an annual basis on an annual basis. The relaxation prices are largely driven by falling vegetable costs.The report also added a warning, the inflation fortress is in “the left tail of the historical inflation distribution of India”, which means that such low levels are unusual and may not apply if unexpected economic shocks arise.The uncertainty about trade has also expressed broader concern about the trust and planning of investors. “Further downward risk for the growth trajectory is mainly due to the uncertainty channel,” the report remarked again, pointing to the wider effects that go beyond numbers on a graph.It also warned of two major risks that can prevent inflation from cooling further, a rapid and smooth resolution of trade negotiations in the VS India, or a sharper than expected increase in core inflation, especially if it gets closer to the 4.0%.In the meantime, the Reserve Bank of India (RBI) has chosen to keep its land. In its policy announcement on Wednesday, the Central Bank kept the REPal rate unchanged and maintained his own growth gaming of 6.5% for the current tax. At the same time, it also reduced its CPI inflation projection for FY26 from 3.7% to 3.1%.As trading tensions simmer and improving inflation -prospects, all eyes remain on how to process negotiations between the two countries and whether India can map a steadily through turbulence.