Global Economy Expected to Slow as India Faces Moderate Growth Dip Says Moody’s Analytics
Moody’s Analytics expects global economic growth to ease in 2026, with India remaining among the fastest growing economies despite a moderate slowdown in overall economic momentum.
The global economy is projected to expand at a slower pace in 2026, according to a new report by Moody’s Analytics, which says India is also likely to experience a moderation in growth even though it will remain one of the world’s strongest performing major economies.
In its latest global outlook, the agency noted that economic performance is becoming increasingly uneven across countries. While sectors connected to artificial intelligence continue to attract investment and drive business activity, many industries that are less linked to the AI boom are finding growth more difficult to sustain.
Moody’s Analytics expects global economic growth to ease to 2.5 percent in 2026 before improving slightly to 2.8 percent in 2027. The report attributes the slowdown to weaker momentum in several large economies, ongoing geopolitical tensions, and disruptions affecting international trade.
India is expected to maintain a relatively strong position compared to many other major economies. However, the report indicates that the country’s economic expansion is likely to slow modestly as global demand softens and international economic conditions become less favorable.
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The report also forecasts lower growth in the United States, where the economy is expected to expand by around 2 percent over the next two years. China’s growth is also projected to moderate, while the Eurozone and Japan are expected to continue facing slower economic activity.
Despite these challenges, Moody’s Analytics believes investments linked to artificial intelligence remain an important source of support for the global economy. Increased spending on data centres, technology infrastructure, and digital innovation is expected to help offset part of the broader slowdown.
The report concludes that although growth is expected to cool, the global economy is likely to avoid a sharper decline, with technology driven investment continuing to provide stability in several regions.
