India’s Q2 FY25 GDP growth came in at 5.4% YoY, missing expectations of 6.5%. Agriculture grew at 3.5%, while manufacturing slowed to 2.2%, and mining contracted by -0.1%. Core GVA growth fell further, indicating sustained weakness in domestic demand and private capex.
HSBC expects the RBI to initiate rate cuts starting in February, with liquidity-easing measures likely to begin as early as December. The brokerage highlighted that while transient factors like prolonged monsoons have played a role, underlying structural challenges need urgent attention to revive growth momentum. HSBC stressed that targeted fiscal measures could complement monetary easing to support broader economic recovery.
