New Delhi, July 23 -- Economic activity in India held up, with improving kharif agricultural season prospects, continuation of strong momentum in the services sector and modest growth in industrial activity, said RBI in its monthly bulletin.

Headline inflation remained below 4 per cent for the fifth consecutive month in June, driven by deflation in food prices, the bulletin said.

The global macroeconomic environment remained fluid in June and July so far amid geopolitical tensions and tariff policy uncertainties.

"System liquidity remained in surplus to facilitate a faster transmission of policy rate cuts to the credit markets. The external sector remained resilient, backed by ample foreign exchange reserves and a moderate external deb...