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India’s manufacturing output rose 8.0% m/m in November (prior **2.0%—no consensus provided), indicating a sharp acceleration in sequential factory activity. Coming alongside a stronger broader IIP backdrop, the print points to improved industrial momentum heading into year-end, though monthly readings can be volatile and sensitive to base effects and seasonal patterns.

Market impact: Mildly bullish for INR and Indian cyclicals—supports the growth narrative and near-term sentiment, with durability best confirmed by follow-on production, orders, and PMI trends.

India’s industrial production accelerated sharply in November, with IIP up 6.7% y/y versus 2.5% expected and 0.5% prior. The cumulative industrial production measure also improved to 3.30% (prior 2.70%), reinforcing a stronger late-year activity pulse and suggesting manufacturing/industrial momentum picked up meaningfully versus the previous month.

Market impact: Supportive for INR and Indian equities—stronger growth momentum can underpin risk sentiment and domestic earnings, though the FX response will also depend on global risk appetite and rates differentials.

India’s FX reserves increased to $693.32B (prior $688.95B), signaling a modest improvement in external buffers and liquidity coverage. Higher reserves can help smooth INR volatility during periods of global risk-off or oil-price shocks, and provide policymakers more flexibility in managing external conditions.

Market impact: Mildly supportive for INR—stronger reserves can bolster confidence and reduce tail-risk around external funding, though INR direction remains heavily influenced by oil prices, U.S. yields, and portfolio flows.

India’s core infrastructure output rose 1.8% y/y in November (prior -0.1%), marking a clear rebound back into expansion after the previous month’s contraction. The improvement suggests firmer activity across key industrial sectors, helping stabilize the near-term growth signal into year-end.

Market impact: Mildly supportive for INR and domestic risk—stronger infrastructure momentum underpins the growth narrative, though FX reaction is usually secondary to global risk sentiment, oil prices, and RBI policy expectations.

India’s FX reserves rose to $688.95B from $687.26B, signalling a modest improvement in external buffers. Markets now turn to the RBI MPC meeting minutes for detail on the committee’s inflation-risk assessment, growth view, and how firmly it is committed to keeping policy accommodative.

Market impact: Mildly supportive for INR via stronger buffers; the minutes can move rates and INR expectations if they signal a shift in the RBI’s easing/bias or inflation vigilance.

RBI Governor Sanjay Malhotra said he expects interest rates to remain low for a prolonged period, arguing that the rate cuts delivered since he took office a year ago helped engineer a “Goldilocks” mix of brisk growth and subdued inflation. India’s headline CPI was 0.71% in November—below the RBI’s 2% lower bound—though it is projected to rise to 2.9% in the January–March quarter, while RBI forecasts point to GDP growth moderating to 6.7% in the April–June period from 8.2% in July–September.

Market impact: INR-supportive at the margin via a pro-growth policy signal, but “low for longer” can also widen rate differentials against the USD if U.S. yields stay elevated; Indian rates and equities may benefit from the dovish carry backdrop.

Apple has held early-stage discussions with CG Semi—building an outsourced semiconductor assembly and test (OSAT) facility in Gujarat—about assembling and packaging certain iPhone-related chips in India, according to an Economic Times report. If it progresses, it would mark Apple’s first serious consideration of moving chip packaging/assembly steps into India, extending its local footprint beyond iPhone assembly already done via partners including Foxconn, Pegatron, and Tata.

Market impact: Constructive for India’s semiconductor/EMS ecosystem and a modest long-term positive for AAPL supply-chain resilience; near-term equity impact likely limited given “exploratory” status, but supportive for the broader “China+1” manufacturing narrative.

India’s Thomson Reuters IPSOS Primary Consumer Sentiment Index (PCSI) eased to 59.31 in December, down from 61.05 previously. While sentiment moderated, the index remains firmly above the neutral threshold, indicating continued optimism among households despite near-term cost pressures and cautious spending behavior.

Market impact: Neutral for INR; softer sentiment is offset by still-strong confidence levels.

India’s M3 money supply expanded 9.9%, slightly below the previous 10.1%, indicating a mild moderation in liquidity conditions. The slowdown reflects tighter financial conditions and ongoing monetary policy efforts to manage inflation and credit growth.

Market impact: Neutral for INR; marginal easing in money supply growth does not materially alter policy expectations.

Microsoft announced plans to invest nearly $23 billion in artificial intelligence infrastructure, marking its largest investment in Asia to date, with a substantial portion directed toward India. The company will allocate $17.5 billion over the next four years to expand cloud and AI infrastructure, accelerate skills development, and support ongoing operations in the country.

A new data center is expected to go live in mid-2026, which would give Microsoft the largest hyperscale presence in India. This commitment comes in addition to the $3 billion in spending previously announced earlier this year, underscoring India’s growing role in the global AI ecosystem.

Market impact: Positive for Indian tech and cloud sectors; reinforces India’s positioning as a key AI and hyperscale infrastructure hub.

India’s central bank delivered a mixed policy signal in its latest decision.

• The cash reserve ratio (CRR) was raised back to 4.00%, up from 3.00%, marking a tightening move aimed at absorbing excess liquidity.
• The policy repo rate was kept unchanged at 5.25%, in line with expectations, after being reduced from 5.50% earlier.
• The reverse repo rate also remained steady at 3.35%.

Market impact: Neutral to slightly bearish for INR; higher CRR tightens liquidity, but steady rates keep the policy tone balanced.

Beyond its rate cut, the Reserve Bank of India rolled out substantial liquidity-support steps to reinforce financial stability.

The central bank announced up to 1 trillion rupees in open market operations (OMOs) and a $5 billion dollar–rupee buy-sell swap, measures aimed at ensuring smooth credit flows and reducing volatility in bond markets.

The combined actions signal the RBI’s commitment to supporting growth while maintaining orderly market conditions amid shifting global financial dynamics.

Market impact: Bullish for Indian bonds and equities; mildly bearish for INR due to additional liquidity.