Home / Economy / News / July's rainfall recovery partly eased farm risks, says RBI report

FDI flows revives in June: Robust Q1 eco momentum continued in July

Manojit Saha Mumbai 4 min read Last Updated : Aug 25 2026 | 10:04 PM IST

The recovery in southwest monsoon in July helped kharif sowing to reach closer to normal levels, partly easing some of the risks to the farm sector, RBI officials said in the state of the economy report released on Tuesday.

The report said the domestic economy showed notable resilience to the ongoing global headwinds, marked by buoyant domestic demand and rising manufacturing and services activity.

The report also highlighted that consumer price index (CPI) based inflation edging up above the Central Bank’s 4 per cent target to 4.45 per cent in July from 4.38 per cent in June was mainly on account of supply side pressures.

While food and beverages fuelled inflation, core inflation, which excludes volatile food and energy prices, remained unchanged, endorsing the lower pass-through of cost pressures.

The report also pointed out that financial conditions are characterised by high credit growth, comfortable liquidity and softening G-sec yields backed by rebound in capital inflows. The views in the report are those of the authors and do not represent RBI’s.

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