- Indian Economy ‘Goldilocks Period’
- GDP growth of 8.2% in October
- The position of the country is strong at the global level
India GDP Growth: Amid global uncertainty and trade challenges, the Indian economy is experiencing a very strong and golden period. Reserve Bank of India (RBI) Governor Sanjay Malhotra expressed satisfaction with the country’s economic development in the December bulletin. Inflation fell to a historic low of just 0.3% in October 2025, while growth was higher than expected. The governor described the situation as a “Goldilocks period”, where a rare combination of high growth and low inflation exists.
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According to the RBI, this is the first time since the adoption of Flexible Inflation Targeting (FIT) that the quarterly average inflation rate has fallen below the 2% target to 1.7%. In October 2025, it reached 0.3% as food prices improved. Governor Sanjay Malhotra said low inflation has boosted the purchasing power of the common man, giving fresh impetus to demand and investment in the market.
India’s GDP growth rate for the second quarter of FY 2025-26 was 8.2%. This impressive growth was driven by record consumer spending during the festive season and the rationalization of GST rates in September 2025. Against this positive backdrop, the RBI has raised its growth forecast for the full fiscal year to 7.3%.
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The RBI Governor emphasized on reforms in banking system regulations, which not only ease of doing business but also enhance customer protection. The banking system is now stronger and financially stable than ever before. The Reserve Bank is entering 2026 with renewed hope and determination, where a strong performance of the agriculture sector and a strong corporate base will propel the economy forward.
What is the ‘Goldilocks period’?
A ‘Goldilocks period’ refers to a situation when an economy has neither high inflation nor low growth. The economy is stable but appreciable. India is currently in this ideal situation, with an average half-yearly growth rate of 8% and a half-yearly inflation rate of 2.2%. However, the governor also advised caution on global trade tensions and geopolitical risks.
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