India’s economy delivered an unexpected boost in the July–September quarter, clocking 8.2% growth—its fastest in six quarters—according to data from the statistics ministry. The figure surpassed both the RBI’s 7% estimate and the Mint poll forecast of 7.2%. Although economists attributed part of the rise to record-low inflation, the strong reading has reduced the likelihood of an RBI rate cut in December. Bond markets reacted quickly, with the benchmark 10-year yield rising to 6.5463%.
The latest growth number compares favourably with last year’s 5.6% and the previous quarter’s 7.8%. Chief economic advisor V. Anantha Nageswaran noted that full-year growth should exceed 7%, supported by solid first-half performance and structural reforms. Manufacturing, financial services and consumption were key contributors, aided by a low base and subdued inflation. Manufacturing GVA rose 9.1%, while consumption grew 7.9%. Investment growth remained firm at 7.3%, though slightly softer than the previous quarter.
Economists say the strong Q2 print lessens the chances of immediate monetary easing, even after earlier rate cuts totalling 100 bps. With first-half growth averaging 8%, full-year GDP is set to surpass the RBI’s earlier projections, though weak nominal growth and upcoming US tariff impacts pose challenges.