<p>Mumbai: India's economic growth is poised to rebound as domestic demand regains strength, but "stickiness" in food inflation warrants careful monitoring, the central bank said in its monthly bulletin released on Friday.</p><p>In India, there is a "conducive quickening" of high-frequency economic activity indicators in the second half of 2024-25, signalling implicit pick up in real gross domestic product growth for this period, the Reserve Bank of India said in an article titled 'State of the Economy' in the bulletin.</p><p>Rural demand continues to gain momentum, reflecting resilience in consumption, supported by brighter agricultural prospects, the RBI said.</p><p>A revival in public capex on infrastructure is also likely to stimulate growth in key sectors, it added.</p><p>The RBI's now-cast model forecasts India's economy to grow at 6.2 per cent in the October-December quarter, per the bulletin.</p><p>India's economy grew by 5.4 per cent in the July-September quarter from a year earlier, compared with 6.7 per cent growth in the previous three months.</p>.The great unease of doing business in India.<p>Growth is projected to slow to a four-year low of 6.4 per cent in the financial year ending March 31.</p><p>Although headline inflation eased for the second consecutive month in December, sticky food inflation warrants careful monitoring of second-order effects, the RBI said in the bulletin.</p><p>India's annual retail inflation eased to a four-month low of 5.22 per cent in December, lower than economists' estimate of 5.3 per cent.</p><p>The slowing inflation is likely to pressure the Monetary Policy Committee to cut rates in February, but a depreciating rupee has complicated the rate-setting panel's woes, some analysts said.</p><p>The volatility in portfolio flows due to global risk-on-risk-off sentiments is the source of exchange rate volatility rather than differentials in inflation or interest rates, the RBI said in a separate article in the bulletin.</p><p>"Throwing sand in the wheels to dampen the exchange rate volatility is more effective than attempts to influence the level of the exchange through large interventions," the RBI said.</p>
<p>Mumbai: India's economic growth is poised to rebound as domestic demand regains strength, but "stickiness" in food inflation warrants careful monitoring, the central bank said in its monthly bulletin released on Friday.</p><p>In India, there is a "conducive quickening" of high-frequency economic activity indicators in the second half of 2024-25, signalling implicit pick up in real gross domestic product growth for this period, the Reserve Bank of India said in an article titled 'State of the Economy' in the bulletin.</p><p>Rural demand continues to gain momentum, reflecting resilience in consumption, supported by brighter agricultural prospects, the RBI said.</p><p>A revival in public capex on infrastructure is also likely to stimulate growth in key sectors, it added.</p><p>The RBI's now-cast model forecasts India's economy to grow at 6.2 per cent in the October-December quarter, per the bulletin.</p><p>India's economy grew by 5.4 per cent in the July-September quarter from a year earlier, compared with 6.7 per cent growth in the previous three months.</p>.The great unease of doing business in India.<p>Growth is projected to slow to a four-year low of 6.4 per cent in the financial year ending March 31.</p><p>Although headline inflation eased for the second consecutive month in December, sticky food inflation warrants careful monitoring of second-order effects, the RBI said in the bulletin.</p><p>India's annual retail inflation eased to a four-month low of 5.22 per cent in December, lower than economists' estimate of 5.3 per cent.</p><p>The slowing inflation is likely to pressure the Monetary Policy Committee to cut rates in February, but a depreciating rupee has complicated the rate-setting panel's woes, some analysts said.</p><p>The volatility in portfolio flows due to global risk-on-risk-off sentiments is the source of exchange rate volatility rather than differentials in inflation or interest rates, the RBI said in a separate article in the bulletin.</p><p>"Throwing sand in the wheels to dampen the exchange rate volatility is more effective than attempts to influence the level of the exchange through large interventions," the RBI said.</p>