India's economy experienced robust growth of 7.8% in the April-June quarter of the current fiscal year, driven by strong activity in the services sector and robust demand.
The ratings of Fitch, one of the three credit rating agencies along with Moody's and Standard & Poor's, impacts the economy of a nation as investors and top companies take them as one of the major factors in taking investment-related decision.
Fitch ratings has affirmed India's sovereign rating at 'BBB-', with stable outlook. More to follow
The rating agency said inflation moderated in August as crude oil prices eased but the risk to food inflation persists given negative seasonality towards the end of this year.
Last month in an unscheduled policy announcement, the Reserve Bank of India (RBI) raised rates by 40 basis points to 4.4 per cent, and subsequently to 4.9 per cent last week.
"The Outlook revision reflects our view that downside risks to medium-term growth have diminished due to India's rapid economic recovery and easing financial sector weaknesses, despite near-term headwinds from the global commodity price shock," the ratings said.
In its Global economic Outlook-March 2022, Fitch said the post-COVID-19 pandemic recovery is being hit by a potentially huge global supply shock that will reduce growth and push up inflation.
The proposed reorganisation plan by Reliance Industries Ltd to transfer its refining, marketing and petrochemical (oil-to-chemicals) businesses to a wholly-owned subsidiary is a step towards facilitating participation by strategic investors in the unit, Fitch Ratings said on Tuesday.
Fitch said India's coronavirus-induced recession has been among the most severe in the world, amid a stringent lockdown and limited direct fiscal support.
In September, Fitch had sharply lowered its forecast for India's gross domestic product (GDP) to a contraction of 10.5 per cent in current fiscal 2020-21 (FY21) versus its previous estimate of 5 per cent contraction.
With coronavirus lockdowns pummelling fuel demand in India, Fitch Ratings expects the marketing and refining volume of state-owned oil firms to fall by more than 15 per cent in the current fiscal year before a gradual recovery in 2021-22.
The Supreme Court's decision to allow telcos to pay outstanding dues over 10 years will not be enough to help Vodafone Idea to stabilise its position, while Jio and Airtel are expected to strengthen their market shares through subscriber gains, Fitch Ratings has said. It further said another tariff hike of at least 20 per cent is probable in the next 12 months.
Fitch Ratings on Monday said recovery of non-banking financial institutions (NBFIs) in near-term is not probable as the sector continues to wrestle with the fallout from the COVID-19 pandemic.
Fitch Ratings on Thursday said it has upgraded Reliance Industries Ltd's rating to 'BBB+' from 'BBB' as the company's financial profile has improved following sale of nearly 25 per cent stake in Jio and Rs 53,124 crore equity raise.
Auto volumes are expected to recover partly in the second half of the ongoing financial year as sales gradually increase after the easing of lockdown measures since May, Fitch Ratings has said.
The move comes after another rating agency Moody’s earlier this month downgraded India’s sovereign rating by a notch to lowest investment grade of ‘Baa2’ for the first time in 22 years.
The rating agency has revised down its economic growth forecast for India to 0.8 per cent for the fiscal year ending March 2021 (FY21), reflecting the impact of the coronavirus pandemic and official efforts to contain it. This is down sharply from its forecast of 5.6 per cent prior to the outbreak.
Facebook Inc's USD 5.7 billion investment in Jio Platforms, subsidiary of Reliance Industries Ltd (RIL), will help to monetise the digital platforms of both companies and aid in deleveraging of RIL's balance sheet, Fitch Ratings said on Thursday.
Fitch Solutions on Monday cut India's economic growth forecast for the financial year 2020-21 to 1.8 per cent saying private consumption is likely to contract due to large-scale loss of income in the face of worsening domestic outbreak of COVID-19.
In a statement, Fitch Group has said, "it has donated USD 50,000 to Give2Asia in support of the organisation's crisis response to the outbreak of COVID-19".
Top News
Latest News
