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Tuesday, December 02, 2025 | 11:40 PM ISTहिंदी में पढें
RBI policy in a season of contradictions: Mixed signals ahead of December 5
HSBC economist argues GDP overstated, inflation structural, and currency depreciation acts as a needed shock absorber
 "Reserve Bank of India, RBI")
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Growth could soften in the first quarter of next year as GST effects fade, fiscal spending tightens to meet deficit targets, and exports lose momentum under the new 50 per cent tariff.
Inflation is at an all-time low, the trade deficit at an all-time high, and growth above the aspirational 8 per cent.
The economy appears to have moved from displaying hints of stagflation a year ago to being in something of a sweet spot now. Yet a few details feel unsettling in the run-up to the policy meeting on December 5.
The strong 8.2 per cent growth seen last quarter benefitted from both cyclical forces and statistical quirks. Strong rains, monetary easing, fiscal spending and goods and services tax (GST) cuts all helped. But a
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