6.2% GDP Growth For December Quarter, Economic Recovery Expected: RBI Report

The Reserve Bank of India (RBI) has projected a 6.2% growth in India’s GDP for the December quarter of fiscal 2025, according to its latest monthly bulletin released on Friday.

This forecast highlights a potential recovery in the second half of the fiscal year, following a slowdown in the first half.

Economic Growth Poised to Rebound

The RBI bulletin notes that economic growth is expected to pick up in the latter half of fiscal 2025, following a period of slower expansion earlier in the year. The GDP grew at 5.4% in the second quarter, the slowest pace in seven quarters, largely due to subdued growth in the industrial sector.

However, the central bank remains optimistic, stating that domestic demand is regaining strength and will likely drive a rebound in the economy.

Rural Demand And Infrastructure Investment Driving Growth

Rural demand has shown resilience, reflecting solid consumption patterns, which are being supported by improved agricultural prospects.

Additionally, the RBI anticipates a revival in public capital expenditure (capex) in infrastructure projects, which is expected to stimulate growth across key sectors.

Risks From Rising Input Costs And Global Challenges

Despite these positive indicators, the RBI has cautioned that rising input costs in the manufacturing sector, along with potential disruptions from weather-related issues and global economic challenges, could pose risks to the growth outlook.

The RBI highlighted that high-frequency economic indicators are showing signs of quickening in the second half of fiscal 2025.

This suggests that real GDP growth will pick up, aligning with the expectations reflected in the first advance estimates of the National Statistical Office (NSO).

Inflation Eases, Food Inflation Remains A Concern

In terms of inflation, the RBI noted that headline inflation has eased for the second consecutive month in December. However, the bank expressed concern over the persistence of food inflation, urging careful monitoring of its secondary effects.

The RBI also pointed to early signs of stronger revenue and earnings growth among corporate India in the third quarter compared to the first half of fiscal 2025.

Brokerages estimate that the combined net profit of Nifty 50 companies could see its fastest growth in the past three quarters.

Sectors such as banking, finance, and insurance are expected to report better earnings, with unlisted companies likely outpacing listed ones in terms of revenue growth.

Also Read: Abhishek Bachchan Highlights India’s Growing Startup Ecosystem & ‘Make In India’ Initiative