High frequency indicators point towards a sequential pick up in economic activity momentum in H2FY25: RBI bulletin

High frequency indicator point a sequential pick up in economic activity momentum in H2FY25

Momentum in the economic activity in the second half of the current financial year has shown a pick up, which was pointed out by high frequency indicators, according to the Reserve Bank of India's (RBI) monthly bulletin released on February 19.

The momentum is likely to sustain going forward, the bulletin added

The monthly State of the Economy article includes views of various experts including Rekha Misra, G. V. Nadhanael, Rajni Dahiya, Durga G, Arpita Agarwal, among others. The views expressed in the article do not reflect the central bank's official stance, the RBI said in a press release.

Industrial activity has recorded an improvement over the previous quarter, as reflected in the Purchasing Managers’ Index (PMI) in January, the bulletin said.

Pick-up in tractor sales growth, and fuel consumption, and sustained growth in air passenger traffic also point to a recovery in overall momentum, Bulletin added.

It further said that rural demand continues to hold up, buoyed by increasing farm incomes. In rural areas, sales of fast-moving consumer good (FMCG) companies grew by 9.9 per cent in Q3:2024-25, much higher than 5.7 per cent in Q2.

Urban demand also exhibited a recovery with 5 per cent growth in Q3, being nearly double of 2.6 per cent in the previous quarter.