Regardless of rising international uncertainties, India’s financial system continues to display resilience throughout sectors, based on the Reserve Financial institution of India’s (RBI) Month-to-month Financial Bulletin for June 2025. The central financial institution’s newest evaluation factors to robust financial momentum in Could throughout industrial and providers sectors, supported by secure monetary situations and easing inflationary pressures.
The RBI famous that numerous high-frequency indicators for Could sign strong financial exercise, additional strengthened by a broad-based improve in agricultural manufacturing throughout 2024-25. This agricultural increase, spanning most main crops, has helped preserve meals inflation in examine. In reality, headline inflation remained under the RBI’s goal for the fourth consecutive month in Could, aided by regular core inflation and a decline in meals value pressures.
“India’s financial resilience is notable in gentle of worldwide challenges akin to commerce coverage uncertainties and geopolitical tensions,” the report acknowledged. It reaffirmed India’s projected GDP progress of 6.5% for FY2024-25, with a major quarter-on-quarter pickup recorded in This autumn.
India additionally stood out globally by way of the Buying Managers’ Index (PMI) efficiency, registering the best total growth amongst surveyed international locations. Export orders remained strong, bucking the worldwide development of contraction. Manufacturing companies reported capability utilisation ranges above their long-term averages, indicating sustained industrial momentum.
On the demand aspect, high-frequency indicators mirrored a restoration in rural consumption, buoyed by robust farm output. Shopper sentiment surveys indicated secure confidence for the current and rising optimism for the close to future.
Within the monetary sector, whereas financial institution credit score progress slowed in April—particularly in agriculture and providers—non-bank lending, together with exterior business borrowings (ECBs), remained regular. Monetary situations had been supportive, enabling efficient transmission of latest fee cuts into the broader credit score market.
Fairness markets, though risky attributable to fluctuating international cues and geopolitical tensions—significantly within the Center East—registered modest features in Could and June. A pointy market dip attributable to geopolitical developments was adopted by a major restoration on June 20.
The RBI additionally highlighted the energy of the exterior sector, citing strong foreign exchange reserves able to masking imports and exterior debt comfortably.
General, the bulletin paints an image of a resilient Indian financial system, navigating international headwinds with robust home fundamentals, secure inflation, and a supportive monetary ecosystem.
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