FX.co ★ India GDP Growth Unexpectedly Rises

India's GDP increased by 7.8% year-on-year for the quarter ending June 2025, up from 7.4% in the previous quarter, marking the most significant growth in five quarters and exceeding market expectations of a 6.6% rise. This growth reflects the country's continued economic momentum following a slowdown in the latter half of 2024, fueled by stronger consumer spending due to reduced inflation, which enhanced household purchasing power. During this period, private consumption rose by 7% annually, government spending surged by 7.4%, and gross fixed capital formation increased by 7.8%. However, net external demand negatively impacted GDP, largely due to US tariff threats. Imports increased by 10.9% annually, even with softer fuel prices, while exports grew by a modest 6.3%.