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India Economy August 2025 -Growthfiniti Wealth Money Trends

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Introduction

The India Economy August 2025 showcased resilience and volatility in equal measure. Domestic growth remained strong, with GDP expanding 7.8% year-on-year and PMI readings hitting multi-year highs. Inflation dropped to a six-year low, giving policy makers breathing space. However, external shocks — particularly U.S. tariffs on Indian exports — weighed on equities and the rupee. This month’s Growthfiniti Newsletter presents a comprehensive breakdown of India’s macroeconomic performance, market trends, global dynamics, and asset class movements in India Economy August 2025.

India Macroeconomic Indicators – India Economy August 2025

In July 2025, India’s industrial production strengthened. The Index of Industrial Production (IIP) grew 3.5% YoY, compared to 1.5% in June.

  • Manufacturing: +5.4%
  • Electricity: +0.6%
  • Mining: -7.2%

Business activity indicators reinforced the momentum.

  • Manufacturing PMI: 59.3 in August 2025, the fastest improvement in 17.5 years, driven by strong demand and supply alignment.
  • Services PMI: 62.9, a 15-year high, supported by robust new orders.

These data points reflect a healthy India Economy August 2025, with both manufacturing and services firing together.

Inflation Hits a 6-Year Low

  • CPI Inflation: 1.55% YoY in July 2025, down from 2.1% in June — the lowest since June 2017 and below RBI’s 2% floor.
  • WPI Inflation: -0.58% YoY in July.

This disinflationary trend positions the India Economy August 2025 uniquely: low prices support households, though policymakers will watch for risks of demand slowdown.

RBI Inflation Data

GDP Growth

India’s GDP expanded 7.8% YoY in Q1 FY26.

  • Manufacturing: +7.7%
  • Agriculture & allied: +3.7%

This strong growth confirms India as one of the world’s fastest-growing economies in August 2025.

Trade Balance and Current Account

  • Merchandise trade deficit: $27.35 billion (July 2025) vs $24.77B last year.
  • Exports: $37.24B (+7.29% YoY).
  • Imports: $64.59B (+8.59% YoY).
  • Current Account Deficit: $2.4B (0.2% of GDP) in Q1 FY26, lower than $8.6B last year.

Fiscal & Forex Reserves

  • GST collections: ₹1.86 lakh crore (+6.5% YoY).
  • Forex reserves: $690.72B (Aug 22, 2025), slightly down from $698.19B in July.

Domestic Equity Market – India Economy August 2025

Market Overview

The India Economy August 2025 equity story was dominated by external shocks. The U.S. doubled tariffs on Indian exports to 50%, threatening manufacturing competitiveness. Renewed Russia-Ukraine tensions further hurt sentiment. Optimism around domestic GST reforms limited downside by raising hopes of boosted consumption and possible RBI rate cuts.

Sectoral Performance

  • Nifty Realty: -4.6% (higher construction costs, weak earnings, RBI holding repo rates).
  • Nifty Metal: -1.4% (exposure to U.S. tariffs).
  • Top gainers: Auto and FMCG, supported by festive optimism (Onam) and speculation of GST cuts on vehicles (two-wheelers from 28% to 18%).
  • Underperformers: Realty, Pharma, Energy.

Valuations

  • Midcaps & Small caps: Above 3-year averages → expensive.
  • Large caps: Below averages → relatively attractive.

For investors, the India Economy August 2025 highlights the need for selective equity allocation.

Fixed Income Market – India Economy August 2025

Bond Yields and Policy Outlook

Bond yields rose as the RBI kept policy rates unchanged, opting to monitor prior cuts’ impact. Fiscal worries resurfaced after GST reforms raised expectations of higher debt issuance. Confidence improved after a global agency upgraded India’s sovereign rating from BBB- to BBB.

Yield Movements

  • G-Sec yields: +3 to 33 bps.
  • Corporate bond yields: +7 to 13 bps.
  • Spreads: Narrowed by 3–21 bps, except 1-year widened by 3 bps.

Fixed income investors in India Economy August 2025 saw both risks and opportunities, particularly in long-dated gilts.

FII, Mutual Fund & Retail Flows – India Economy August 2025

Foreign Institutional Investors (FIIs)

  • Net equity outflows: ₹34,993 crore in August 2025.
  • Turned net buyers in debt after 4 months of selling.

Mutual Funds

  • Net equity buyers for 54 months (except Apr 2023 & Aug 2022).
  • Debt: Net sellers for 16 consecutive months.

SIP Flows

Retail participation remained robust:

  • Monthly SIP contribution: ₹28,464 crore in July 2025 (record high).
  • SIP AUM: ₹15.19 lakh crore (vs ₹15.31 lakh crore in June).
  • Outstanding SIP accounts: 944.97 lakh.

The India Economy August 2025 underscores how retail flows are strengthening long-term market depth.

Global Macroeconomic Indicators – India Economy August 2025

Growth & Inflation Highlights

  • U.S. CPI: +0.2% in July; annual inflation steady at 2.7%; core CPI +0.3%.
  • U.K. GDP: +0.4% in June (after -0.1% in May).
  • U.S. Manufacturing PMI: 53.0 in August, best since May 2022.
  • China PMI: 50.5 in August, beating consensus 49.5.

Equity Markets

  • Emerging markets: China led gains; India & Korea lagged.
  • Developed markets: Japan rose most; Germany & France slipped.
  • U.S. markets: Boosted by softer inflation, Fed Chair’s Jackson Hole speech hinting at cuts.

Fixed Income

  • U.S. 10-year Treasury yield: Down 13 bps to 4.23%.
  • Real returns: Positive in 10 economies, with Brazil, India, and the U.K. on top.

These global signals shaped investor sentiment in India Economy August 2025.

Commodities & Currency – India Economy August 2025

Crude Oil

Brent crude fell on oversupply fears. OPEC+ confirmed a 547,000 bpd hike for September 2025, and U.S. inventories rose unexpectedly.

Precious Metals

  • Gold: Rose on safe-haven demand and Fed rate cut expectations.
  • Silver: Outperformed all asset classes in India Economy August 2025.

Rupee

The rupee depreciated against the U.S. dollar, pressured by FII outflows, tariff shocks, and global dollar strength. Optimism around GST reforms cushioned losses slightly.

Asset Class Performance – India Economy August 2025

  • Winners: Silver, followed by Gold.
  • Losers: Crude Oil and Domestic Equities.

This asset rotation reflects risk aversion and safe-haven flows in India Economy August 2025.

Global Market Calendar Year Performance

India Economy August 2025

Key Takeaways – India Economy August 2025

  • GDP growth surged to 7.8%; PMI hit multi-year highs.
  • Inflation fell to a six-year low, below RBI’s tolerance band.
  • Equities struggled due to U.S. tariffs and geopolitics.
  • Fixed income gained strength from a sovereign rating upgrade.
  • SIP inflows reached a record ₹28,464 crore, reflecting retail confidence.
  • Globally, easing inflation boosted sentiment; precious metals outperformed commodities.

The India Economy August 2025 highlighted India’s economic strength, resilience in consumption, and the need for investors to balance equity risks with fixed income and global diversification.

Download Growthfiniti Wealth Money Trends August 2025 Report

Growthfiniti Wealth Pvt. Ltd.
SEBI Registered Portfolio Manager (INP000009418) | AMFI Registered Distributor (ARN-168766) | APMI Registered PMS Distributor (APRN00443) | Associated Person with Motilal Oswal Financial Services Ltd.

Disclaimer: Investments are subject to market risks. Past performance is not indicative of future results.

Click to read Growthfiniti Wealth Money Trends July 2025 Report..

Ego, Emotion, and Your Portfolio

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In investing, ego and emotion often matter as much as analysis. At work, myself, Aditya, Raj & the research team keep having discussions around various strategies. We get plummeted by numbers & back tested portfolios by so many managers, we have seen serious allocations being made to strategies which rarely have a long term track record.

The longer you spend in markets, the clearer one truth becomes: the line between success and failure is rarely drawn by spreadsheets or stock charts alone, it often runs straight through the mind of the investor.

Howard Marks captured this idea brilliantly when he wrote that ,

“Refusing to join in the errors of the herd, like so much else in investing, requires control over psyche and ego. It’s the hardest thing, but the payoff can be enormous. Mastery over the human side of investing isn’t sufficient for success, but combining it with analytical proficiency can lead to great results.”

Read Howard Marks’ memos on investor psychology

This insight strikes at the core of what separates exceptional investors from the average crowd. Analysis can tell us , what, to do, but only psychological strength determines whether we actually do it. To be successful, you must cultivate the rare blend of sharp analysis and emotional discipline: the ability to remain objective under stress, to restrain ego, and to resist the gravitational pull of herd behaviour.

In many ways, Investing is less a war of numbers than a war against oneself. Let’s explore how failures of ego and triumphs of discipline have played out in real life.

LTCM: What It Teaches Your Portfolio

The Downfall of a “Dream Team”: The LTCM Story….few stories illustrate the dangers of unchecked ego as starkly as the rise and fall of Long-Term Capital Management (LTCM).

Founded in 1994, LTCM assembled a constellation of financial brilliance, including Nobel laureates Myron Scholes and Robert C. Merton. Their strategy hinged on exploiting tiny pricing discrepancies between related securities, a sophisticated arbitrage game that promised steady, market-neutral returns. Armed with mathematical models that appeared flawless when tested against the past, LTCM attracted immense capital and leveraged it aggressively, sometimes up to 25 times its base. For a while, it seemed like pure genius: returns north of 40% convinced the world that they had cracked the code.

But brilliance can breed blindness. The team’s models assumed the world would continue behaving as it always had. Their confidence in the mathematics, and in their own intellect, left little room for humility or doubt. When an unforeseen shock struck in 1998, Russia’s surprise debt default, markets stopped resembling their carefully calibrated equations. Correlations broke down. Spreads that were supposed to narrow exploded wide open. And leverage, once a multiplier of brilliance, became a merciless accelerant of collapse.

In a matter of weeks, their empire evaporated. What followed wasn’t just a hedge fund’s implosion but a near-black hole for the entire global financial system, forcing an unprecedented rescue by the US Federal Reserve.

The lesson? Even Nobel laureates can be humbled when analytical genius outpaces emotional restraint. Ego whispered: , “The model can’t be wrong.”, Reality roared back, “You can be.”

Background on Long-Term Capital Management (LTCM)

Rupee-Cost Averaging: A Portfolio Discipline That Works

The Other Side: Power of Discipline Over Deep Analysis, Now contrast that with the steady simplicity of an investor who practices, rupee-cost averaging. This investor has no PhD in mathematics, no insider market models, no illusions of outsmarting Wall Street. Their system is simple: invest a fixed amount, say ₹100,000, in a broad-market Flexi Cap fund every month. No market calls. No sudden bets. Just mechanical consistency.

What makes this approach deceptively powerful is not intelligence but discipline. When markets soar, this investor resists the urge to chase speculative fads. When markets plunge, as they did in 2008 or 2020, they keep buying, even as the world around them screams panic. Their advantage lies in emotional resilience: the refusal to waver in the face of greed or fear.

Over decades, this method quietly compounds into serious wealth. Not because of clever timing or deep research, but because of something rarer: a calm, repeatable process sustained through every cycle.

What is rupee/dollar-cost averaging?

Takeaway: Tie Analysis to Humility

These two stories, LTCM’s dramatic implosion and the humble yet steady rupee-cost averaging, underscore the same truth from opposite directions. Markets reward brilliance, but only when it is tethered to humility. They punish arrogance, even when wrapped in the sheen of genius. And they quietly reward those who can stay steady when others lose their heads.

In short, success in investing is rarely about always being the smartest person in the room. It’s about never letting ego and emotion be the loudest voices in your own head.

Read about behavioural biases on our LinkedIn Page
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Money Trends July 2025 | Strong GDP Growth, Market Volatility Ahead

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July 2025 Market Pulse: What Investors Need to Know

Money Trends July 2025 was a month of contrasts across global and domestic markets. While India’s macro indicators signaled resilience, equity markets came under pressure from tariff tensions and muted corporate earnings. At Growthfiniti, we believe staying informed about these shifts is essential for building enduring financial legacies. Understanding the Money Trends July 2025 can help investors navigate these challenges effectively.

India’s Economic Landscape: Resilience Amid Headwinds

  • Growth and Output: India’s GDP grew 7.4% YoY in Q4 FY25 (MOSPI Data), with manufacturing moderating to 4.8% but agriculture and allied sectors accelerating to 5.4%.
  • Industrial Production: IIP growth slowed to 1.5% in June from 1.9% in May.
  • Inflation: Consumer inflation fell sharply to 2.1%, well below RBI’s 4% target (RBI Inflation Data), supported by easing food prices. Wholesale inflation also dipped into negative territory.
  • External Balance: The current account swung into a surplus of $13.5 bn (1.3% of GDP), while the trade deficit narrowed on lower imports.
  • Fiscal Position: Fiscal deficit stood at 17.9% of FY26 Budget Estimates in Q1, up from 8.4% a year earlier.

Investor Takeaway: Cooling inflation and strong GDP growth provide a supportive macro backdrop, but slowing industrial output and fiscal slippage call for cautious optimism.

Indian equity markets declined in July, with Nifty 50 down 2.9% as global trade tensions escalated and U.Indian equity markets declined in July, with Nifty 50 down 2.9% as global trade tensions escalated and U.S. tariffs on Indian goods loomed.

  • Sector Winners: Pharma (+3.3%), Healthcare (+2.9%), and FMCG (+1.7%) benefited from defensive demand and export optimism.
  • Sector Losers: IT (-9.4%), Realty (-7.5%), and PSU Banks (-4.9%) dragged indices lower, hit by weak earnings, layoffs, and trade concerns.

Valuations: Midcap and Smallcap indices remain expensive versus Large caps, trading well above 3-year averages.

Investor Takeaway: Defensive sectors continue to shine amid uncertainty, but valuations in mid- and small-caps warrant careful risk budgeting.

Bond yields moved up as liquidity tightened and RBI struck a hawkish tone (RBI Monetary Policy), prioritizing forward-looking inflation control. The 10-year benchmark yield closed higher at 6.38%, aligning India among the world’s higher real-yield markets.

Additionally, the Money Trends July 2025 report highlights the importance of adapting investment strategies to current market conditions.

Investor Takeaway: Rising yields present opportunities in selective bonds, especially as inflation cools and carry remains attractive.

Flows & SIPs: Retail Investors Stay the Course

  • FIIs: Net sellers in equities (₹17,741 cr outflow), reversing three months of inflows (SEBI Market Statistics).
  • DIIs: Continued strong buying (₹60,939 cr inflow), supporting markets.
  • SIPs: Monthly SIP contributions hit a record ₹27,269 cr, with AUM at ₹15.31 lakh cr—underscoring the resilience of retail investors (AMFI SIP Data).

Investor Takeaway: While global flows remain volatile, Indian households are showing remarkable discipline in systematic investing.

Considering the Money Trends July 2025 data, investors should assess their portfolios in light of the changing landscape.

The insights from Money Trends July 2025 suggest a watchful approach to fixed income investments.

Global Signals: A Divergent Recovery

  • U.S. GDP rebounded 3.0% in Q2, retail sales and job data beat expectations (IMF Outlook), supporting equities.
  • China grew 5.2% YoY, but manufacturing PMI slipped back into contraction, signaling export weakness.
  • Europe & Japan saw modest growth, with central banks holding rates steady amid inflation moderation.

Global equity markets largely advanced, led by U.S. (+3.7%) and UK (+4.2%), while India and Brazil underperformed (World Bank Global Prospects).

In summary, the Money Trends July 2025 emphasize resilience and adaptability in investment approaches.

According to the Money Trends July 2025, market dynamics continue to evolve, requiring strategic responses.

Furthermore, the Money Trends July 2025 guide provides key insights into retail investor behavior.

Investor Takeaway: Global markets are navigating tariff risks with surprising resilience, but Asia remains vulnerable to trade frictions.

Commodities & Currency: Oil Climbs, Rupee Weakens

  • Brent Crude rose 5.5% to $75/barrel on geopolitical tensions (MCX Commodity Data).
  • Gold declined 2.5% as risk appetite improved, while silver gained 4.1%.
  • INR depreciated against the dollar, pressured by equity outflows and rising oil prices.

Investor Takeaway: Rising crude prices and a weaker rupee could pressure India’s import bill and inflation trajectory.

Final Word: Process Over Noise

July underscored a simple truth—while headlines swing between tariffs, trade deals, and rate decisions, long-term wealth creation depends on process, not noise. At Growthfiniti, we anchor portfolios to the Growthfiniti Efficient Frontier (GEF), balancing risk and return across asset classes with discipline.

June’s Money Trends highlighted how shifting global trade tensions, cooling inflation, and resilient domestic demand continue to shape India’s investment landscape. The right portfolio positioning today can help you ride volatility while capturing long-term growth.

Money Trends June 2025

Therefore, reviewing the Money Trends July 2025 forecasts can aid in making informed investment decisions.

At Growthfiniti, we turn insights into action. If you’d like a personalized review of your portfolio based on June’s Money Trends, connect with us and discover how disciplined asset allocation can safeguard and grow your wealth.

Notably, the findings in Money Trends July 2025 reveal critical shifts in commodity prices.

Contact Us

In light of the Money Trends July 2025, external factors may influence domestic economic strategies.

Ultimately, the Money Trends July 2025 encapsulate the current market narrative and future opportunities.

Money Trends June 2025

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Reciprocal Tariff Threat Not as Severe as Feared; Likely to Revert Quickly

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While concerns over reciprocal tariffs on India may seem alarming, sectoral nuances indicate that the actual impact could be less severe than perceived. The extent of the effect largely depends on how President Trump approaches tariff imposition. Sectors that appear most vulnerable include Automobiles, Gems & Jewelry, Chemicals, and Pharma, but their risk levels vary significantly based on how tariffs are structured—whether applied broadly across countries or targeted at specific sectors or sub-sectors.

For instance, India’s tariffs on automobiles (100-125%) are substantially higher than those imposed by the US, while auto component tariffs (7.5-10%) are relatively moderate. The actual exposure of the auto sector, therefore, hinges on the specificity of US tariff implementation. A similar pattern is observed across other vulnerable sectors, where varying tariff rates on sub-components and commodity groups complicate the assessment. Given this complexity, it is likely that the US will impose reciprocal tariffs at a broad country level rather than with a sector-specific focus. However, such tariffs could be rolled back within six months due to increasing economic and political pressure.

Zero-for-Zero’ Industrial Tariffs as a Strategic Concession

A significant portion—over 70%—of India’s imports from the US already face tariffs below 5%, challenging the notion that India imposes high tariffs on US goods across the board. A strategic and minimally disruptive concession India could offer is a ‘zero-for-zero’ tariff arrangement on a broad set of industrial goods, similar to those already imported at zero tariffs from Free Trade Agreement (FTA) partners like Japan, South Korea, and ASEAN countries.

Since these goods already enter India duty-free, extending the same benefit to the US would not impact domestic industries while offering a tangible gesture of trade cooperation. However, agricultural commodities should be excluded from such negotiations, as they require separate trade discussions. This approach would allow India to avoid engaging in a full-fledged FTA, where the US might push for difficult compromises on services, patents, and government procurement. Additionally, sectors such as apparel and petroleum products are unlikely to be affected by reciprocal tariffs, as the US already imposes tariffs that match or exceed those levied by India.

Assessing India’s Potential Gains from the Trade War

India saw a tangible benefit from the previous US-China trade war, with exports to the US increasing by $38 billion between 2017 and 2023—one of the largest gains among US import sources. However, China successfully mitigated its losses by rerouting exports through Mexico and Vietnam, maintaining its export dominance.

The scope of the current proposed tariffs is broader than the previous trade war, making the potential impact difficult to predict. With no official reciprocal tariffs announced yet, their precise effects remain uncertain. Nonetheless, considering the scale of Chinese manufacturing, a complete decoupling from the US market seems unlikely. Chinese goods are expected to find alternative trade routes, reducing the direct benefits India might gain from any resulting supply chain shifts.

Money Trends February 2025

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Domestic equity markets declined amid ongoing uncertainty surrounding the U.S. President’s plans for reciprocal tariffs, raising concerns about a prolonged trade war and potential inflationary pressures. Investor sentiment was further dampened by the U.S. Federal Reserve’s statement that it is “not in a hurry to lower interest rates” and plans to “pause rate cuts to evaluate further progress in inflation.”

RBI Monetary Policy February 2025

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The Reserve Bank of India (RBI) reduced policy rates by 25bps, a decision unanimously supported by all Monetary Policy Committee (MPC) members, while maintaining a neutral policy stance, also backed by the committee. FY26 GDP growth is projected at 6.7%, with CPI inflation estimated at 4.2%. The RBI highlighted rising global risks leading to capital outflows and a weakening USD-INR exchange rate. Future policy actions will be data-driven to balance inflation and growth dynamics, with liquidity conditions managed to ensure adequate system liquidity.

Key Takeaways from RBI’s Statement:

The MPC acknowledged that inflation has moderated, supported by a favourable food inflation outlook and the continued transmission of past monetary policy actions. Headline inflation is expected to ease further in FY26. However, growth has slowed significantly compared to the previous year’s trend. These dynamics provide room for the MPC to focus on stimulating growth while ensuring inflation remains aligned with the target. Consequently, the MPC decided to lower the policy repo rate by 25bps to 6.25% while maintaining a neutral stance to retain flexibility in responding to evolving macroeconomic conditions.

Growth and Inflation Outlook:

FY26 Growth Estimated at 6.7%

The first advanced estimate places FY25 growth at 6.4%, driven by a recovery in private consumption. Growth is being supported by the service sector and improvements in agriculture, while sluggish industrial growth remains a drag. Looking ahead, strong rabi forecasts and an anticipated industrial rebound should strengthen economic expansion in FY26. Household spending is expected to remain robust, aided by income tax relief in the Union Budget. Fixed investment is set to pick up, supported by higher capacity utilization, strong corporate and financial sector balance sheets, and continued government-led capital expenditure.

However, risks remain, including geopolitical tensions, protectionist trade policies, fluctuations in global commodity prices, and financial market uncertainties. Given these factors, FY26 real GDP growth is projected at 6.7%, with quarterly estimates as follows:

  • Q1: 6.7%
  • Q2: 7.0%
  • Q3: 6.5%
  • Q4: 6.5%

Global Economy Remains Stable

While global growth remains below its historical average, high-frequency data suggests resilience, supported by continued expansion in global trade. Key risks include geopolitical uncertainties, slower disinflation, and policy unpredictability. Additionally, a strong US dollar continues to pressure emerging market currencies, increasing financial market volatility.

FY26 Inflation Expected at 4.2%

The inflation trajectory will depend on several factors:

  1. Food Inflation: Expected to soften, provided there are no supply-side shocks, supported by good kharif production, easing vegetable prices in winter, and positive rabi crop prospects.
  2. Core Inflation: Expected to remain moderate.
  3. Global Uncertainty: Continued financial market volatility and fluctuations in energy prices remain concerns.
  4. Weather Risks: Adverse climatic events pose upside risks to inflation.

Taking these factors into account, the CPI estimate for FY25 is maintained at 4.8%, with Q4 revised to 4.4% (-10bps). The FY26 CPI projection stands at 4.2%, with quarterly estimates as follows:

  • Q1: 4.5%
  • Q2: 4.0%
  • Q3: 3.8%
  • Q4: 4.2%

Liquidity and Financial Market Measures:

  • Forward Contracts in Government Securities: This initiative will help long-term investors, such as insurance funds, manage interest rate risk across cycles and enable efficient pricing of bond-backed derivatives.
  • Expanded Access to the RBI Electronic Trading Platform: SEBI-registered non-bank brokers will now be allowed to participate in secondary market transactions for government securities.
  • Market Trading and Settlement Review: The RBI will conduct a comprehensive review of trading and settlement timings for financial markets under its regulation.

System Liquidity in Deficit:

Liquidity turned negative in December and January, driven by factors such as advance tax payments, capital outflows, forex operations, and a notable increase in currency circulation. India’s foreign exchange reserves have eased from record highs, standing at $631 billion as of January 31, 2025.

Cybersecurity and Payment Systems:

  • New ‘bank.in’ Domain: A dedicated domain for Indian banks aims to enhance cybersecurity and trust in digital banking and payment services. A ‘fin.in’ domain is also planned for non-bank entities in the future.
  • Additional Factor of Authentication (AFA) for Online International Transactions: Strengthening security for international card-not-present (online) transactions by implementing AFA for added protection.

Our Analysis:

The repo rate cut and RBI’s commentary align with expectations. The new governor emphasized the importance of the existing flexible inflation-targeting framework while signaling potential refinements in line with evolving data and conditions. His first policy statement suggests continuity with the previous regime and regulatory approach.

We anticipate that future rate cuts will remain data-dependent, influenced by inflation trends, global developments, asset prices, and domestic growth. Liquidity support measures are a structural positive for the economy. Our FY26 GVA estimate aligns with RBI’s projection, while our inflation outlook is slightly higher.

Money Trends January 2025

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Domestic equity markets fell during the month on uncertainty over the U.S. trade policies under the new U.S. President’s regime.

The U.S. President gave a mixed set of signals, as he delayed tariff plans on Chinese goods but threatened to impose tariffs on Canada and Mexico. Losses were extended on concerns over a weakening rupee, rising crude oil prices and continued outflows by the foreign institutional investors from domestic equity markets.

However, losses were restricted as sentiment was boosted after the RBI announced several measures to inject over Rs. 1 lakh crore liquidity into the banking system. Investors reacted positively to the Economic Survey 2025 tabled in the Parliament on Jan 31, 2025, that pegged GDP growth between 6.3% to 6.8% for FY26.

Union Budget 2025-26

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The 2025-2026 Union Budget presents a comprehensive plan aimed at revitalizing the economy, empowering the middle class, and fostering inclusive growth. As stakeholders in India’s economic development, it is imperative that we align our strategies to leverage these opportunities and contribute to the nation’s progress.

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