New Delhi, July 2 -- The Centre's fiscal position weakened in the first two months of FY27 as higher subsidy and interest outgo, coupled with muted revenue growth, pushed the fiscal deficit to Rs1.62 trillion, or 9.6 per cent of the full-year Budget Estimate (BE), according to a report by Equirus Securities.

The report said the deterioration was driven by a sharp rise in expenditure even as government receipts declined.

"GOI's April-May FY27 fiscal deficit is Rs1.62 trillion - 9.6 per cent of BE vs Rs 0.1 trillion in the same period in FY26 due to approx 18 per cent y-o-y increase in total expenditure... while total receipts have declined by approx -2 per cent due to a decline in both tax and capital receipts," the report said.

Despite...