July has bolstered macroeconomic fundamentals even as global growth lost pace from the third quarter, a Reserve Bank of India (RBI) article said Thursday.
According to the article on ‘State of the Economy’ published in the latest RBI Bulletin, in India, a broad-based gaining of momentum is discernible in high frequency indicators. Deleveraging and higher capacity utilisation have enabled capital-heavy industries to gain traction, it added.
“The Indian rupee (INR) is exhibiting low volatility. Inflation has moderated from its July peak, bolstering macroeconomic fundamentals,” the article said.
Retail inflation declined to a three-month low of 5.02 per cent annually in September on account of moderation in vegetables and fuel prices, and back within the Reserve Bank’s comfort level.
The inflation based on Consumer Price Index (CPI) was 6.83 per cent in August and 7.41 per cent in September 2022.
In July, inflation touched a peak of 7.44 per cent.
Further, the article said that global growth lost pace from the third quarter of this year on the back of weak manufacturing activity and tight financial conditions in advanced economies even as several emerging market economies posted growth surprises.
Surging yields and soaring crude oil prices have emerged as proximate risks to global growth, it added.
RBI said the views expressed in the article are of the authors and do not represent the views of the central bank.
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First Published: Oct 19 2023 | 8:44 PM IST