New Delhi, Sept. 2 -- The Centre's fiscal position remains comfortable in the early months of FY27, but slower nominal GDP growth could put pressure on the government's fiscal deficit target of 4.3 per cent of GDP, Union Bank Research said in a report.

The report said the government has managed to increase capital spending while keeping the fiscal deficit under control, helped by strong tax collections. However, weaker-than-expected nominal GDP growth could reduce the government's fiscal space and may require it to control spending in the second half of the financial year.

Union Bank Research has lowered its estimate for FY27 nominal GDP growth to 10-11 per cent from 13-15 per cent earlier. It said the lower growth would limit the benef...