The Indian economy is witnessing a steady resurgence in momentum during the second half of the financial year 2024-25 (H2FY25), driven by high-frequency indicators, according to the Reserve Bank of India’s (RBI) monthly bulletin released on February 19.
Industrial activity has improved over the previous quarter, as reflected in the Purchasing Managers’ Index (PMI) for January. The bulletin further highlights that this positive momentum is likely to sustain in the coming months.
The monthly State of the Economy article, featuring insights from experts such as Rekha Misra, G. V. Nadhanael, Rajni Dahiya, Durga G, and Arpita Agarwal, underscores these developments. However, the RBI clarified that the views expressed in the article do not represent its official stance.
Several economic indicators signal a broader recovery. The uptick in tractor sales, increased fuel consumption, and sustained growth in air passenger traffic all point to a strengthening economic trajectory. Additionally, rural demand remains robust, supported by rising farm incomes. In Q3 FY25, sales of fast-moving consumer goods (FMCG) companies in rural areas grew by 9.9%, a significant rise from 5.7% in Q2.
Urban demand has also rebounded, with a 5% growth in Q3, nearly doubling the 2.6% growth recorded in the previous quarter. These trends collectively suggest a positive outlook for economic activity in the near term.
