India Monthly Activity Chartbook Investment activity remains resilient in August

Economics Research 21 September 2026 | 10:44AM IST

India: Monthly Activity Chartbook: Investment activity remains resilient in August

August high frequency activity point to some moderation in urban consumption, Santanu Sengupta | although investment activity remained broadly resilient. Q3 real GDP growth is Goldman Sachs India SPL tracking close to our 7.3% yoy estimate, helped by strong manufacturing and Arjun Varma services activity. Going forward, however, the re-escalation of the Middle East | conflict and Brent crude oil prices above $100/bbl, together with El Niño-related Goldman Sachs India SPL

risks, pose some downside risks to growth and upside risks to inflation.

Moderation in urban consumption activity. Urban consumption indicators moderated in August. Passenger vehicle registration growth moderated to 14.6% yoy (vs. 25% yoy in July) but remained strong, while domestic air passenger traffic sequentially increased but contracted further by 7.1% on a year-over-year basis (Exhibit 5). In the first two-weeks of September, air passenger traffic is tracking a significant sequential increase. Meanwhile, petrol consumption and GST collections remained robust near one-year highs. Rural activity also showed a more uneven picture. Two-wheeler registrations increased sequentially but the year-over-year growth moderated, while tractor registration growth fell sharply to a one-year low of 2.5% yoy. Meanwhile, demand for work under the rural employment program rose by 5.1% yoy in August, following a significant contraction in July. El Niño-related weather conditions remain a key source of uncertainty, with cumulative rainfall in key rice-producing states below the long-period average as of September 17 and reservoir storage in most key wheat-producing states at three-year lows.

Investment activity remained resilient. Electricity consumption accelerated to a two-year high of 12.8% yoy, and bank credit growth remained robust at 19.1% yoy (Exhibit 11 and Exhibit 13). However, manufacturing and transport activity moderated, with automobile production growth slowing to a three-month low of 17.3% yoy (Exhibit 12).

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Summary of monthly high-frequency activity indicators

High frequency activity indicators suggests moderation in urban consumption activity while investment activity remains resilient.

Exhibit 1: Moderation in urban consumption activity High Frequency Activity Indicators Year-over-Year (%)

Improving activity Aug-26 Sector Indicator Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Jun-26 Jul-26 Aug-26 3m rolling average Light motor vehicle registrations Domestic air passenger traffic Aviation Turbine Fuel - Petrol consumption Urban consumption E-way bill demand GST collections CMIE Urban sentiment RBI urban consumer confidence Index Urban consumption demand composite indicator 3 Two-wheeler registrations Tractor registrations Major Agriculture exports Rural consumption Rural employment program (demand for work) - demand CMIE Rural sentiment RBI rural consumer confidence Index Rural consumption demand composite indicator

1) Domestic air passenger traffic for the month of August is estimated from the daily data available from the Ministry of Civil Aviation. Historical data is from Airports Authority of India

2) Data in seasonally adjusted index levels

3) Urban consumption demand composite score is the equal-weight average of the rolling z-scores of the YoY transformations of: a) Light motor vehicle registrations, b) domestic air passenger traffic, c) ATF consumption, petrol consumption, d) E-way bills and GST collections. 4) Rural consumption demand composite score is the equal-weight average of the rolling z-scores of the YoY transformations of: a) two-wheeler registrations, tractor registrations, b) major agriculture exports and c) rural employment-program work demand; the work-demand z- score is inverted so lower work demand indicates stronger activity.

Source: CEIC, CMIE, SIAM, MOSPI, Goldman Sachs Global Investment…