Credit ratings agency Fitch Ratings on Thursday revised India’s growth forecast for the current financial year to 7.2% from the earlier 7.8%, PTI reported. The agency released its Global Economic Outlook on Thursday, in which it cited higher financing cost and reduced credit availability.

The agency had projected 7.4% and 7.8% growth in June and September. The latest forecast is also lower than Reserve Bank of India’s 7.4% growth estimates for this fiscal year.

Fitch estimated India’s Gross Domestic Product growth to be 7% and 7.1% in financial years 2019-2020 and 2020-2021. In September, the rating agency had forecast growth at 7.3% for 2019-2020 and 2020-2021. The Indian economy grew 6.7% in the 2017-2018 fiscal.

“We have lowered our growth forecasts on weaker-than-expected momentum in the data [GDP], higher financing costs and reduced credit availability,” Fitch Ratings said.

The agency said GDP growth has “softened quite substantially” in the July-September quarter of the current fiscal growing by 7.1%, as against 8.2% in the April-June quarter. “Consumption was the weak spot, stepping down from 8.6% to 7%, though still growing at a healthy rate,” it said. “Other components of domestic demand fared well, notably investment, which has been steadily strengthening since 2017.”

Fitch Ratings said India’s fiscal policy should continue to support growth in the run-up to the General Assembly elections in 2019 and forecast Indian rupee to weaken to 75 to a dollar by the end of 2019. The rupee was trading at 70.51 against a dollar on Thursday.

“The widening of the current account deficit amidst tighter global financing conditions should put downward pressure on the currency...” it said.

Fitch said it expects inflation to rise mildly in the coming months, on normalising food prices and higher import prices due to the depreciation of rupee. The wholesale price inflation rose to 5.28% in October compared to 5.13% the previous month.