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Goldman Sachs sees 8.7% GDP growth...

business Updated: Dec 08, 2010 23:19 IST
HT Correspondent

Backing the National Stock Exchange Nifty index to hit 6,800 by the end of the calendar 2011, Goldman Sachs has projected a growth rate of 8.7% for 2011-12 and a moderated 8.3% in 2012-13 for the economy, amid concerns over inflation and fiscal and current account deficits.

The investment banker has however projected a growth recovery in the US, and expects its economy to grow by 2.7% in 2011 (against 1.9% forecast earlier) and 3.6% in 2012. The global growth outlook now stands at 4.6% for 2011 and 4.8% for 2012.

It has revised its expectation on interest rate hike in the Indian economy at 100 basis points in 2011 as against its earlier forecast of 50-75 basis points till June next year.

It has projected 6% inflation for the next financial year, but Tushar Poddar, chief economist, Goldman Sachs India said, “Even these are elevated levels considering what RBI expects.”

“High and rising current account deficit is a key risk to India’s growth story. We believe the deficit would widen to above 4% of GDP in 2011-12,” a report by Goldman Sachs said.