Indian economy remains a key driver of global development on the again of sound macroeconomic fundamentals and prudent insurance policies, the Reserve Bank of India (RBI) mentioned on Monday (June 30, 2025).
In its bi-annual Financial Stability Report (FSR), the Central Bank additionally mentioned elevated financial and commerce coverage uncertainties are testing the resilience of the global economy and the monetary system.
āFinancial markets remain volatile, especially core government bond markets, driven by shifting policy and geopolitical environment. Alongside, existing vulnerabilities such as soaring public debt levels and elevated asset valuations have the potential to amplify fresh shocks,ā the RBI mentioned.
Despite an unsure and difficult global financial backdrop, it mentioned the Indian economy remains a key driver of global development, āunderpinned by sound macroeconomic fundamentals and prudent macroeconomic policiesā.
āThe domestic financial system is exhibiting resilience fortified by healthy balance sheets of banks and non-banks. Financial conditions have eased supported by accommodative monetary policy and low volatility in financial markets. The strength of the corporate balance sheets also lends support to overall macroeconomic stability,ā the RBI mentioned.
According to the report, the soundness and resilience of scheduled industrial banks (SCBs) are bolstered by strong capital buffers, multi-decadal low non-performing loans ratio and powerful earnings.
Results of macro stress exams affirm that almost all SCBs have satisfactory capital buffers relative to the regulatory minimal even beneath adversarial stress eventualities. Stress exams additionally validate the resilience of mutual funds and clearing firms, it added.
