The Reserve Bank of India (RBI), in its June 2025 Bulletin, has affirmed the resilience of India’s economic activity despite mounting global challenges stemming from trade policy disruptions and geopolitical tensions.
According to the RBI’s State of the Economy article, high-frequency indicators for May 2025 signal robust performance across the industrial and services sectors, while agriculture has shown a broad-based increase in production across major crops during the 2024–25 season. The bulletin also noted that headline inflation remained below the central bank’s 4% target for the fourth consecutive month, aided by easing food prices and stable core inflation.
The RBI attributed the positive momentum to benign financial conditions, which have facilitated the effective transmission of recent policy rate cuts. Earlier this month, the central bank reduced the repo rate by 50 basis points to 5.50%, citing a favorable inflation outlook and the need to support growth amid global volatility.
The bulletin revised the inflation forecast for FY 2025–26 downward from 4.0% to 3.7%, reflecting confidence in sustained price stability. On the growth front, the National Statistical Office (NSO) has projected real GDP growth at 6.5% for 2024–25, supported by strong private consumption, improving investment activity, and healthy corporate and banking sector balance sheets.
The RBI also highlighted progress in financial inclusion, noting that over 95% of Indian households now have access to banking services, thanks to initiatives like the Jan Dhan-Aadhaar-Mobile (JAM) trinity and the widespread adoption of UPI. As of March 2025, 514 districts had achieved full digital enablement.
Despite global headwinds, including a slowdown in exports and volatility in commodity markets, the RBI emphasized that India’s macroeconomic fundamentals remain strong. The central bank introduced a new Financial Conditions Index (FCI) to monitor liquidity, credit, and market dynamics in real time.
RBI Governor Sanjay Malhotra stated, “In this global milieu, the Indian economy presents a picture of strength, stability, and opportunity. We remain committed to striking the right balance between growth and inflation.”
