Mumbai: The Reserve Bank of India (RBI) has stated that the fiscal, monetary, and regulatory measures implemented so far this year are expected to create a virtuous cycle of higher private investment and sustained economic growth, leading to long-term economic resilience. This was highlighted in the ‘State of the Economy’ article published in the November RBI Bulletin.
Indian Economy Shows Signs of Momentum
Despite ongoing global headwinds, the Indian economy continues to show signs of stronger momentum. According to the bulletin, high-frequency indicators for October suggest robust expansion in both manufacturing and services sectors, supported by festive season demand and the ongoing positive impact of GST reforms.
The article notes that inflation has moderated to historic lows, remaining well below target, while financial conditions have stayed benign, supporting smooth flow of financial resources into productive channels.
Fiscal and Monetary Measures to Boost Investment
The RBI highlighted that the measures undertaken so far this year should pave the way for a virtuous cycle of higher private investment, productivity, and growth, ultimately contributing to long-term economic resilience.
Global Uncertainty Remains Elevated
While the domestic economy shows positive signs, the bulletin noted that global uncertainty remains high. October saw a slight pullback in global uncertainty after more than a year of continuous increase. The RBI cautioned about heightened exuberance in global equity markets, emphasizing concerns regarding sustainability and implications for financial stability.
The central bank clarified that the views expressed in the ‘State of the Economy’ article are those of the authors and do not represent the official views of the Reserve Bank of India.
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