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India’s Infrastructure Output rose 1.7% YoY in April, improving from the previous 1.2%. The data suggest a modest recovery in core infrastructure activity, though the pace remains moderate.

Importance Level: Low

Possible Market Effect: The improvement is mildly positive for India’s growth outlook and infrastructure-linked equities, but the direct impact on INR is likely limited.

Overall Market Sentiment: Neutral-to-Buy for Indian growth-sensitive assets / Neutral for INR

Q&A

Did India’s infrastructure output improve in April? Yes. Infrastructure output rose 1.7% YoY, up from 1.2% previously.

Is India’s infrastructure output growth strong? It improved, but the pace remains moderate at 1.7%.

Source: India Ministry of Commerce and Industry

Importance: Medium

Market Sentiment: INR Neutral-to-Sell

India’s external data showed stronger trade flows but a weaker balance. Exports rose to $43.56B in April, up from $38.92B previously. However, imports jumped to $71.94B, from $59.59B, pushing the trade deficit to -$28.38B, worse than the -$27.00B forecast and deeper than the previous -$20.67B.

India’s FX reserves rose to $696.99B, up from $690.69B, offering a stronger reserve buffer despite the larger trade gap.

Possible Market Effect:

The wider trade deficit is negative for INR because import demand, likely including energy costs, rose sharply. Higher FX reserves help cushion the pressure, but the overall signal remains Neutral-to-Sell for INR.

Q&A

Did India’s trade deficit widen in April?

Yes. The deficit widened to -$28.38B, worse than the -$27.00B forecast.

Did India’s foreign exchange reserves improve?

Yes. FX reserves rose to $696.99B from $690.69B.

Source: Ministry of Commerce and Industry, India; Reserve Bank of India

Importance: Low

Market Sentiment: INR Neutral-to-Buy

India’s Thomson Reuters IPSOS PCSI rose to 66.57 in May, up from 66.17 previously. The improvement was modest, but the index remains relatively strong compared with many developed-market readings.

Possible Market Effect:

The data are slightly supportive for INR and India’s domestic-demand outlook, though inflation concerns from higher wholesale fuel prices may limit the positive impact.

Q&A

Did India’s consumer sentiment improve in May?

Yes. India’s PCSI rose to 66.57 from 66.17.

Source: Thomson Reuters / Ipsos

Importance: Medium

Market Sentiment: INR Neutral-to-Sell

India’s wholesale inflation accelerated sharply in April. WPI Inflation (YoY) jumped to 8.30%, far above the 4.40% forecast and the previous 3.88% reading. The biggest driver was fuel, where WPI Fuel inflation surged to 24.71% from 1.05% previously.

Underlying pressure also strengthened. WPI Manufacturing Inflation rose to 4.62% from 3.39%, while WPI Food inflation edged up to 1.98% from 1.90%.

Possible Market Effect:

This is negative for Indian inflation sentiment and mildly negative for INR. A sharp WPI shock, especially from fuel, can raise concerns about imported inflation, production costs, and possible pressure on the Reserve Bank of India to remain cautious.

Q&A

Did India’s April WPI inflation beat expectations?

Yes. India’s WPI inflation jumped to 8.30%, far above the 4.40% forecast.

What was the main driver of India’s wholesale inflation surge?

Fuel was the main driver, with WPI Fuel inflation rising to 24.71% from 1.05%.

Source: Office of the Economic Adviser, Ministry of Commerce and Industry, India

India’s CPI inflation slowed to 3.48% YoY in April, below the forecast of 3.80%, but slightly above the previous 3.40%. The result keeps inflation below expectations while still showing a small increase from the prior reading.

Importance: Medium.

Possible Market Effect:

The softer-than-expected CPI print may support expectations that the Reserve Bank of India can remain less restrictive if inflation stays contained. INR sentiment: Neutral to Mildly Positive.

Q&A:

Was India’s April CPI lower than expected?

Yes. Indian CPI came in at 3.48% YoY, below the 3.80% forecast.

Source: Ministry of Statistics and Programme Implementation, India

India’s FX reserves declined to $690.69B, down from $698.49B previously. However, domestic liquidity and credit indicators remained strong. M3 money supply grew 12.0%, slightly above the previous 11.9%. Bank loan growth accelerated to 16.0% from 15.0%, while deposit growth edged up to 12.3% from 12.2%.

The data gives a mixed picture: external reserves softened, but domestic credit activity remained healthy.

Importance: Low

Possible Market Effect: Lower FX reserves may slightly weaken confidence in India’s external buffer, but strong loan and deposit growth support the domestic banking and growth outlook.

Overall Market Sentiment: INR — Neutral

Q&A:

Q: Is India’s latest financial data positive or negative for INR sentiment?

A: It is mixed. FX reserves fell to $690.69B, but loan growth improved to 16.0% and deposit growth rose to 12.3%.

Source: Reserve Bank of India

India’s HSBC Manufacturing & Services PMI rose to 58.20 in April, above the previous 57.00 but slightly below the 58.30 forecast. The HSBC India Services PMI strengthened to 58.8, beating the 57.9 forecast and rising from 57.5 previously. The data confirms strong private-sector expansion, led by services.

Importance: Medium

Possible Market Effect: Strong services momentum may support Indian equities and the rupee, although the small composite miss could limit the upside reaction.

Source: HSBC / S&P Global

India’s HSBC Manufacturing PMI eased to 54.7 in April, below the 55.9 forecast but still above the previous 53.9 reading. The data shows manufacturing activity remained firmly in expansion, although the pace of growth cooled compared with market expectations.

Importance: Medium

Possible Market Effect: A weaker-than-expected PMI may limit near-term enthusiasm for Indian equities, but the reading above 50 still supports the broader growth story.

Source: HSBC / S&P Global

India’s industrial production rose 4.1% YoY in March, above the forecast of 3.7%, but slower than the previous 5.1%. Cumulative industrial production stood at 4.10%, unchanged from the previous 4.10%. Manufacturing output rose 4.3% MoM, easing from the previous 5.9%.

Importance Level: Low

Possible Market Effect:

The better-than-expected industrial production figure may offer mild support to Indian equities, but the slowdown from the previous reading suggests limited upside momentum for growth-sensitive sectors.

Source: Ministry of Statistics and Programme Implementation of India

Futures tied to India’s Nifty 50 declined 0.5%, pointing to a weaker opening signal for Indian equities. The move suggests traders are pricing in caution amid regional weakness and higher crude oil risk.

Possible Market Effect:

Lower Nifty futures may weigh on Indian equities at the open, while higher oil prices remain a key risk for India because of imported energy sensitivity.

Source: NSE IFSC / GIFT Nifty Market Data

India’s FX Reserves increased to $703.31B, up from $700.95B previously. The rise points to a modest strengthening in the country’s external buffer and keeps reserve holdings at a high level.

Importance: Low

Possible Market Effect: Higher reserves are mildly supportive for perceptions of external stability and can help underpin confidence in the rupee during periods of global volatility.

Source: Reserve Bank of India

India’s preliminary April PMI readings pointed to continued strength across the private sector. HSBC Manufacturing & Services PMI rose to 58.30 from 57.00, while HSBC India Manufacturing PMI increased to 55.9 from 53.9 and HSBC India Services PMI edged up to 57.9 from 57.5. All three readings remained well above the 50 level, signaling ongoing expansion, with the composite index showing a stronger overall pace of activity at the start of the new quarter.

Importance: Low

Possible Market Effect: The firm PMI mix is supportive for the Indian growth outlook and may modestly support equities and the rupee, as it points to resilient private-sector momentum.

Source: HSBC / S&P Global