The global economy is in a state of flux, reeling from the twin shocks of trade policy uncertainties and a spike in geopolitical tensions, said an article in the RBI’s June Bulletin.
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The Reserve Bank Bulletin on Wednesday said amid global uncertainties, various high-frequency indicators point towards resilient economic activity in India across the industrial and services sectors.
The global economy is in a state of flux, reeling from the twin shocks of trade policy uncertainties and a spike in geopolitical tensions, said an article in the RBI’s June Bulletin.
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“In this state of elevated global uncertainty, various high-frequency indicators for May 2025 point towards resilient economic activity in India across the industrial and services sectors,” it said.
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Agriculture showed a broad-based increase in production across most major crops during 2024-25. Also, the domestic price situation remains benign, with headline inflation staying below the target for the fourth consecutive month in May.
Financial conditions too remained conducive to facilitate an efficient transmission of rate cuts to the credit market, said the article on ‘State of the Economy’.
“Global economic prospects remained fragile even as economic and financial uncertainty receded from their heightened levels in April buoyed by optimism emanating from the US tariff freeze and bilateral trade deals,” it noted.
It said that on the domestic front, the provisional estimates released in May have reaffirmed growth to be 6.5% in 2024-25, with a significant sequential pickup in Q4.
Among the countries surveyed for the Purchasing Managers’ Index (PMI), overall expansion in activity was the highest in India with the expansion in new export orders witnessed in May being an outlier, amidst contraction seen in other major economies.
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