High-frequency indicators of overall economic activity remained robust in October, supported by Goods and Services Tax (GST) cuts and an increase in festival spending | Photo credit:
According to the State of the economy In this article prepared by RBI officials, the Indian economy appears to be more resilient to external shocks over time.
Officials said there has been further improvement in demand conditions in October, pointing to resilient growth prospects.
The growth, supported by strong services exports, remittance receipts and oil prices becoming less damaging to current account sustainability, comes amid uncertainties over global trade policy and headwinds in the external sector, she added.
Officials felt that demand conditions showed signs of improvement with the revival of urban demand and continued strength of rural demand.
Moreover, high-frequency indicators of overall economic activity remained robust in October, supported by Goods and Services Tax (GST) cuts and an increase in festival spending. GST collections have improved over the past month, indicating a strong recovery in consumer demand.
“Sowing of all rabi crops is progressing well after harvesting of kharif crops. High frequency indicators for October indicate further broadening of manufacturing activity and continued robust expansion in services sector,” the officials said. They noted that headline inflation fell to an all-time low (of 0.3 percent) in October, significantly helped by favorable supply-side factors including the prospects of a good kharif season and the reduction in VAT rates.
The external sector’s ability to absorb shocks has also improved over time, building resilience amid uncertainties in global trade policy.
The authors found that global uncertainty remains high, although there was a slight pullback in October after more than a year of sustained increases.
Concerns remain about increased exuberance in global stock markets, raising questions about its sustainability and implications for financial stability, she added.
Published on November 24, 2025
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