Moody’s pegs growth in 2008 at 8%
MUMBAI: Rating agency Moody’s has forecast that the Indian economy will grow by around 8% in ‘08, marginally slower than estimated 9% growth in ‘07. In a report released from Sydney the rating agency said that although the economy’s fundamentals remain strong and its prospects upbeat, growth will moderate in 2008 as domestic demand eases and exports cool. According to Moody’s, tight money conditions will dampen demand for credit and take some steam out of consumer spending. But despite monetary tightening, Moody’s feels that RBI is unlikely to raise rates further, for fear of putting further upward pressure on the rupee that would crimp growth, and also to avoid a potential loan crisis that could quickly dampen consumer and business sentiment.