Goldman Sachs sees rate cuts by year-end as GST reforms boost credit demand in India

Goldman Sachs expects India’s central bank to consider a rate cut by late 2025 amid easing inflation and steady fiscal conditions. Economists note that GST rate rationalization has begun driving higher consumption and expanding formal credit demand. However, India’s core sector growth slowed to 3% in September due to reduced coal and oil output. Despite this, analysts maintain that domestic macro conditions remain stable, backed by record foreign reserves, controlled fiscal deficit, and resilient private capital expenditure cycles.