Economy and regulatory updates
- Retail inflation in India rose to 4.45% in July 2026 from 4.38% in June 2026.
- Wholesale prices in the country eased to 9.78% in July from 9.87% in June.
- India’s merchandise trade deficit widened to $31.98 billion in July from $30.43 billion in June. Merchandise exports rose to $44.24 billion in July from $40.41 billion in the previous month, while imports stood at $76.22 billion as against $70.84 billion.
- The government has approved the introduction of 1 billion polymer banknotes in denominations of Rs 10 and Rs 20, aimed at enhancing durability and reducing replacement costs.
- The government clarified that transactions through the Unified Payments Interface will remain free for users, although the government may consider introducing Merchant Discount Rate charges for large merchants at a later stage.
- The Reserve Bank of India (RBI) has introduced revised loan recovery guidelines effective January 2027, mandating recorded recovery calls, stricter conduct standards for recovery agents, and enhanced borrower protection measures aimed at improving transparency and preventing misconduct.
- The RBI has proposed a new capital framework for derivative risks, scheduled to take effect from April 2027, with the objective of strengthening risk management and capital adequacy standards for regulated entities.
- The Securities and Exchange Board of India (SEBI) has proposed allowing foreign portfolio investors (FPIs) to participate in physically settled non-agricultural commodity derivatives, including crude oil, natural gas, gold, and silver contracts.
- SEBI has proposed increasing the ISIN limit for privately placed debt securities from 14 to 17 to ease refinancing and liquidity pressures for issuers.
Source: MOSPI, RBI
Indian debt market update
- The interbank call money rate closed higher at 5.25% in the week ended August 14 compared with 5.10% in the week ended August 7.
- The yield on the 10-year benchmark 6.94% 2036 bond closed at 6.76% in the week ended on August 14, from 6.77% in the previous week.
- Softer economic data from the United States (US) and declining expectations of further Federal Reserve rate hikes supported demand for government securities and exerted downward pressure on yields.
- However, losses were limited by elevated crude oil prices amid renewed uncertainty over the West Asia conflict, which heightened concerns about imported inflation.
- Domestically, retail inflation edged up to 4.45% in July from 4.38% in June, remaining within the RBI's tolerance band, but reinforcing a cautious outlook on the inflation trajectory.
Source: CRISIL Fixed Income Database,^ Data as of 7th Aug 2026 vs 31st Jul 2026 vs 3rd Jul 2026 respectively
Source: CRISIL Fixed Income Database
Indian equity market updates
- Indian equities ended lower on a weekly basis, as persistent uncertainty over the situation in West Asia and the reopening of the Strait of Hormuz, along with volatility in crude oil prices, weighed on investor sentiment. Further, profit-booking and inflationary concerns added pressure, though support from resilient corporate earnings and easing global rate risks helped limit the downside. The BSE Sensex and Nifty 50 fell 0.62% and 0.83%, respectively.
- Sectoral performance was largely negative during the week. The BSE Metal, BSE FMCG and BSE Auto indices declined 1.44%, 0.98%, and 0.71%, respectively, amid profit booking and weakness due to investor caution.
- On the other hand, the BSE Realty, BSE Consumer Durables and BSE Capital Goods indices rose 1.25%, 1.12%, and 1.06%, respectively, supported by sector-specific buying and earnings optimism.
- Near-term market direction is likely to be driven by developments in West Asia and movement in crude oil prices. Additionally, investors are also expected to track India’s infrastructure output for cues on domestic growth, along with foreign fund flows.
- Weekly flows: Domestic Institutional Investors (DIIs) recorded net inflows of Rs 9,285.63 crore, while Foreign Institutional Investors (FIIs) saw net inflows of Rs 1,228.24 crore.
- MTD trend: DIIs reported net inflows of Rs 17053.00 crore, whereas FIIs registered net inflows of Rs 4115.93 crore.
- YTD positioning: DIIs remained net buyers at Rs 5,14,736.95 crore, while FIIs remained net sellers at Rs 3,39,951.18 crore.
Source: BSE, NSE
Source: SEBI, NSE, NSDL
Global Equity market summary
- US stocks ended the week with a mixed performance. Dow Jones weighed down by rising crude oil prices driven by escalating US-Iran geopolitical tensions, while Nasdaq Composite gained as softer economic data reinforced expectations that the US Fed would keep interest rates unchanged in September.
- Britain's FTSE ended lower during the week. The mining sector weighed on the index after a major copper producer issued a less optimistic production forecast. Japan’s Nikkei ended higher for the week, supported by gains in technology and artificial intelligence (AI)-related stocks, amid continued optimism around the global AI theme and easing expectations of a near-term US rate hike. A weaker yen also provided support to export oriented stocks.
- Hong Kong equities ended the week lower, as investor sentiment was cautious amid geopolitical uncertainty and higher oil prices, while softer US inflation data provided some support as expectations of an imminent rate hike by the US Fed eased.
- China’s Shanghai Composite declined during the week as investors turned cautious after a recent rally, with tighter liquidity and profit-booking weighing on equities. Concerns over the domestic property sector and cautious positioning ahead of upcoming corporate earnings also weighed on market sentiment.
Source: Websites of respective stock exchanges
Global Yield
- The US 10-year Treasury yield rose marginally during the week, supported by higher crude oil prices amid escalating geopolitical tensions and persistent concerns over inflation.
- The rise in yields was particularly evident towards the end of the week as Brent crude prices climbed amid renewed tensions in the Middle East and uncertainty over US-Iran negotiations.
- Higher energy prices raised concerns over renewed inflationary pressures and reduced the scope for an immediate easing in monetary policy.
- The benchmark US 10-year Treasury yield rose to 4.68% on August 14, from 4.65% on August 7.
Source: Financial Websites
Commodities and Currency
- Crude oil prices rose during the week on the NYMEX closing to $82.40 per barrel on August 14, 2026, compared with $78.18 per barrel on August 7, 2026, amid concerns over potential supply disruptions, driven by uncertainty around the Strait of Hormuz and persistent geopolitical tensions.
- Gold prices rose to Rs 1,52,363 per 10 grams as of August 14, from Rs 1,49,621 per 10 grams as of August 7, owing to safe haven demand amid heightened geopolitical uncertainty and concerns over global economic growth.
- Silver prices also increased to Rs 2,33,842 per kg on August 14, compared with Rs 2,31,381 per kg on August 7, tracking gains in gold amid rising safe haven demand.
- The rupee ended lower at Rs 95.43 against the US dollar on a weekly basis, as persistent pressure from higher crude oil prices, strong demand for the greenback and geopolitical uncertainty weighed on the currency.
- However, likely intervention by the RBI India limited the losses.
Source: Respective commodity exchanges, ibjarates.com
Source: RBI Reference Rate
Global Economic
- The US economy unexpectedly lost 23,000 jobs in July 2026, compared to a downwardly revised gain of 20,000 jobs (from 57,000 earlier) in June 2026.
- The US inflation rate slowed to 3.4% in July 2026, compared with 3.5% in June 2026 while core inflation rate eased to 2.5% from 2.6%.
- Eurozone Industrial Production improved to 0.1% in June 2026 from a revised decline of 0.1% in May 2026 (earlier reported as a 1.2% decline).
- China's annual inflation eased to 0.5% in July 2026 compared to 1.0% in June 2026.
Source: Financial Websites
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