SUMMARY
* India’s October manufacturing and services PMIs surged to 58.5 (18-month high) and 62.1 (15-month high) respectively, signaling broad-based economic acceleration.
* These elevated readings point to Q2 FY26 GDP growth potentially exceeding 7.2%, cementing India’s global outlier status amidst a slowdown in major economies.
* Robust domestic consumption from festive demand, uptick in export orders, and sustained government capital expenditure drive this surge, per Axis Bank’s Meera Singh.
* Strong job creation in labor-intensive sectors and IT fueled purchasing power; the Nifty 50 hit 22,850, a new high, reflecting positive investor sentiment.
*The RBI, with CPI at 4.8% and Repo at 6.5% since February 2025, remains data-dependent, though global commodity volatility and geopolitical risks persist.
NEW DELHI, November 4, 2025 – India’s manufacturing and services sectors expanded sharply in October, driving Purchasing Managers’ Indexes to multi-year highs and signaling robust overall economic growth, cementing the nation’s global outlier status.
The elevated PMI readings for October unmistakably signal strong expansion, likely pushing Q2 FY26 GDP growth above 7.2%. This performance cements India’s global outlier status, contrasting sharply with decelerating growth in major economies.
The S&P Global Manufacturing PMI jumped to 58.5 in October from September’s 57.5, an 18-month high. Concurrently, the Services PMI climbed to 62.1 from 60.8, a 15-month peak. Both figures, comfortably above 50, show broad-based acceleration.
Fueled by new orders across all goods categories and accelerating activity in transport, information, and finance, this robust expansion reflects strong domestic consumption. “October’s elevated PMI readings unmistakably point to strong expansion,” said Meera Singh, Chief Economist at Axis Bank.
Inflation remains manageable, though risks persist. India’s Consumer Price Index (CPI) eased marginally to 4.8% in September 2025, comfortably within the Reserve Bank of India’s (RBI) 2-6% target. The central bank held its benchmark Repo Rate at 6.5% since February 2025.
“Maintaining price stability remains paramount,” RBI Governor Shaktikanta Das told reporters on November 1. Seasoned India-watchers noted the RBI’s careful balancing act, refined through multiple inflation cycles where premature tightening could derail growth.
Financial markets responded positively, with the Nifty 50 index rising 1.2% to 22,850 on November 4, marking a new all-time high and extending a rally since late September. The Indian 10-year government bond yield edged up 3 basis points to 7.28%, signaling heightened growth expectations and latent inflation concerns.
Strong new order inflows drove significant employment gains across manufacturing and services. This strength also stems from sustained government capital expenditure on large-scale infrastructure projects and picking up private sector investment in digital services, renewable energy, and electric vehicle manufacturing.
Yet, risks persist. Global commodity price volatility, especially crude oil, remains critical, potentially reigniting domestic inflation and impacting fiscal and current accounts. Geopolitical developments and rising trade protectionism also threaten India’s export growth and supply chains.
Sustained strong PMI readings could draw greater foreign direct investment. The RBI’s monetary policy decisions will heavily depend on inflation’s evolution, with policymakers likely focusing on structural reforms to boost productivity and leverage India’s demographic dividend to solidify its global economic hierarchy.
