New Delhi [India], March 2 (ANI): The domestic GDP growth is expected to advance further in the fourth quarter of the current financial year, supported by a strong boost to consumption spending along with a revival in investment, according to a report by Bank of Baroda.

The report noted that India's GDP growth clocked 7.8 per cent in Q3FY26, as compared to a growth of 7.4 per cent in Q3FY25. For the full year, growth is estimated at 7.6 per cent, driven by robust performance in the manufacturing sector.

It stated 'Going forward, growth is expected to advance in Q4 further as has been evident form the high frequency indicators'.

These estimates have been revised upwards from the earlier projection of 7.4 per cent to align with the new base year of 2022-23. With respect to the revision, the report stated that a major change incorporated includes double deflation in agriculture and manufacturing in order to appropriately capture price issues.

Looking ahead, the bank expects growth to advance further in Q4, as reflected in high-frequency indicators. It said the momentum will be supported by a strong boost to consumption spending along with a revival in investment activity.

In addition, accommodative monetary conditions and benign inflation are expected to provide further support to economic activity.

The report said these factors bode well for the overall growth outlook. It also noted that given the rebasing of the GDP series, there is unlikely to be much impact on fiscal ratios.

So the Bank of Baroda has retained its estimate of GDP growth in the range of 7-7.5 per cent for FY27.

The assessment indicates that domestic demand conditions remain supportive, with consumption and investment emerging as key drivers. Alongside this, stable inflation and favourable monetary conditions are seen providing a conducive environment for sustained economic expansion in the coming quarters.

With growth in Q3FY26 already at 7.8 per cent and full-year growth estimated at 7.6 per cent, the report suggests that the Indian economy continues to demonstrate resilience, supported by manufacturing strength and improving demand conditions. (ANI)