October 20, 2025
The central bank attributes this strength to low inflation, robust corporate earnings, and healthy banking sector balance sheets
RBI recently revised India’s GDP growth forecast upward to 6.8 per cent for the current financial year
The bank noted that domestic reforms are cushioning the economy against weak global demand and external uncertainties
The Monetary Policy Committee (MPC) believes current macroeconomic stability provides room to support further growth
The Reserve Bank of India (RBI) has said that the ongoing flux in the global economy poses significant challenges to the global macroeconomic outlook, adding that India is not entirely insulated from these developments. However, it emphasised that the domestic economy remains resilient, supported by low inflation, solid corporate earnings, and a robust banking system.
In its latest monthly bulletin, the central bank noted that these factors are helping sustain the economy’s momentum despite global volatility. Earlier this month, the RBI raised its forecast for India’s GDP growth to 6.8 per cent for the current financial year. It said that domestic growth drivers remain strong even amid external uncertainties.
The central bank further stated that ongoing structural reforms are helping offset the adverse effects of weakening global demand. The report also reiterated the Monetary Policy Committee’s view that prevailing macroeconomic conditions have created space for further measures to support growth.
On the external front, the RBI addressed the impact of trade tensions with the United States. It acknowledged that India faces punitive tariffs on exports to the U.S., following President Donald Trump’s insistence that these would remain unless India reduces its imports of Russian oil.
Despite these tariffs, the central bank maintained that the overall impact on India’s growth remains limited. It said that merchandise trade continues to show resilience, although exports to the U.S. saw a notable decline in September as the higher tariffs took effect.
The bulletin concluded that India’s growth outlook remains stable, driven by strong domestic fundamentals, even as global economic headwinds continue to challenge emerging markets.
Source: Economic Times