It, however, cautioned that negative cross-border spillovers and adverse global developments can act as a deterrent to achieving the potential high growth path in the current financial year. “But the price of such stability and growth is eternal policy vigilance,” said the report.
The finance ministry’s monthly economic report for June said better prospects for global growth than anticipated in the first half of 2023 mean that commodity prices are firming up. The price of brent crude is up nearly 20% from its recent lows. “Better growth prospects and higher commodity prices mean that monetary tightening in the developed world may have further to run. That will affect the monetary policy trajectory in developing countries, too, due to currency and capital flow effects,” it said.
