Bharat Barometer for August - Inflation remained subdued; FII inflows declined

The performance of Indian economy on some key indicators, in the month of August, 2025, is given below.

Macroeconomic indicators (Score: 4/5)

• Headline inflation remained subdued, with both CPI and WPI at low levels, while GST collections grew modestly. PMIs strengthened further above 60, alongside declining unemployment rates.

External sector (Score: 4/5)

• Goods exports returned to double-digit growth, supported by steady services exports, while imports also expanded strongly. Net FDI inflows improved on a monthly basis, though FII flows continue to decline for the second straight month.

Central government finance (Score: 1/5)

• Subsidy payouts degrowth continues; capex degrows despite higher year-to-date achievement versus prior year. Revenue expenditure growth moderated, while cumulative direct tax collections slipped deeper into degrowth.

Industrial activity (Score: 3/5)

• Coal offtake growth rises sharply and power generation growth picked up marginally, while petroleum products consumption turned positive. Steel demand remained in high single-digit growth territory, though e-way bill generation showed slight moderation.

Demand & consumption (Score: 2/5)

• Passenger air traffic declined for the fourth consecutive month, while foreign tourist arrivals contracted further. Life insurance premium growth surged, but non-life slowed; auto registrations degrows despite modest PV sales growth.

Banking & money flow (Score: 3/5)

• Money supply and credit growth remained steady, with deposits outpacing credit marginally. UPI transactions expanded strongly, IMPS volumes showed first growth after a year of contraction, and Fastag growth softened.

Rural indicators (Score: 4/5)

• Fertiliser sales revived after three months of contraction, while reservoir storage growth dropped sharply. Rural employment edged up, tractor sales growth moderated, and two-wheeler sales accelerated to lower double-digit levels.

Capital market (Score: 1/5)

• Net new SIP registrations stayed positive but declined sequentially, with equity MF inflows and SIP contributions moderating. Trading volumes continued to contract for the tenth straight month.

Disclaimer : This content is only for informational purpose. It does not make any recommendation to act or invest.

Source: HDFC Securities Institutional Research

Full Report: https://www.hdfcsec.com/hsl.docs/Bharat%20Barometer%20-%20Sep25%20-%20HSIE-202509161304552373418.pdf?t=1692025132254947