New Delhi, Aug. 29 -- Buoyed by continued lower inflation, the Indian economy clocked 7.8% gross domestic product (GDP) growth in the first quarter of FY26, a five-quarter high. The number defied expectations of a slowdown and beat the 6.7% projection by economists in a Mint poll and the 6.5% projected by the Reserve Bank of India (RBI).

The latest print is higher even than the 7.4% recorded in the previous quarter, data released by the statistics ministry on Friday showed. While a large part of that could be attributed to continued lower inflation in the country, the surprisingly high GDP growth dampens the immediate prospect of any further cuts in the policy rate by the RBI.

However, some economists expressed concern over a fall in no...