Indian economy picks up further pace despite global headwinds: RBI bulletin

MUMBAI: The Indian economy showed signs of a further pick up in momentum, despite continuing global headwinds. Available high-frequency indicators for October suggest a robust expansion in both manufacturing and services activities, supported by festive season demand and the ongoing positive impact of the GST reforms, according to the RBI monthly bulletin released on Monday.

Inflation has moderated to a historic low and remained well below the target rate. The fall in inflation was driven by a decline in food prices and the GST rate cut on goods and services prices, besides favourable base effects. Financial conditions remained benign, and the flow of financial resources to the commercial sector increased significantly from a year ago, the bulletin states.

GST collections improved over the previous month, indicating a strong pick up in consumer demand. Sowing of all rabi crops is progressing well following the harvesting of kharif crops.  High-frequency indicators for October suggest further broadening of manufacturing activity and continued robust expansion in the services sector. Merchandise trade deficit widened to an all-time high in October 2025.

While exports contracted after remaining in expansion for three months, reflecting the adverse impact from global headwinds, imports surged on account of higher gold and silver imports, catering to the festive demand, the RBI bulletin further states.

To mitigate the impact of trade disruptions on exports arising on account of global headwinds, the Reserve Bank implemented various trade relief measures for exporters with immediate effect.

Tariff exemptions on some agricultural products by the US on November 14, 2025 will help Indian exports, it observes. (IANS)

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