Key Market insights - Altifi Weekly Bulletin | 5 December 2025

Economy and regulatory updates

• The Reserve Bank of India (RBI) said India's current account deficit moderated to $12.3 billion, or 1.3% of GDP in the second quarter of this fiscal, on the back of a lower merchandise trade deficit.
• India’s industrial production increased 0.4% on-year in October, compared with an upwardly revised 4.6% gain in September.
• The country’s HSBC Manufacturing PMI eased to 56.6 in November, compared with 59.2 in October and Services PMI edged higher to 59.8 compared with 58.9 while Composite PMI eased to 59.7 from 60.4.
• Fitch Ratings raised its growth forecast for the country this fiscal to 7.4% from its earlier estimate of 6.9%, citing increased consumer spending and improved consumer sentiment following Goods and Services Tax reforms.
• The Monetary Policy Committee of the RBI reduced the policy repo rate under the liquidity adjustment facility (LAF) to 5.25%. Consequently, the standing deposit facility rate fell to 5.00%, and the marginal standing facility rate and the Bank Rate to 5.50%.
• The committee maintained neutral stance and raised GDP growth estimates for this fiscal to 7.3% from 6.8% earlier while cutting retail inflation forecast to 2% from 2.6% earlier.
• The RBI will conduct open market operation (OMO) purchase auctions of government securities for an aggregate amount of Rs 1 lakh crore in two tranches of Rs 50,000 crore each to on December 11 and 18.
• Parliament approved a Bill to levy a higher excise duty on tobacco and related products once the GST compensation cess ends, with the Rajya Sabha returning the legislation to the Lok Sabha.
• The RBI has issued Amendment Directions to update regulations under the Gold Metal Loan (GML) Scheme for commercial and small finance banks.
• It issued the draft Guidelines on Enhancing Credit Supply for Large Borrowers through Market Mechanism (Repeal Circular), 2025, seeking feedback from the stakeholders on the proposal to repeal the extant instructions issued in 2016.
• It has, from time to time, issued several instructions/ guidelines to co-operative banks, i.e., primary (urban) co-operative banks, state co-operative banks and district central co-operative banks, related to permission for place of business, change of name and scheduling.

Domestic macroeconomic indicators

 Indian debt market update

• The interbank call money rate ended lower at 5.35% on December 5 compared with 5.50% on November 28.
• Government bond prices ended higher in the week ended December 5 and the yield on the 10-year benchmark 6.33% 2035 paper closed at 6.52% on December 5 compared with 6.55% on November 28.
• Bond prices rose supported by strong state debt demand and possible RBI buying. The RBI’s rate cut and announcement of liquidity infusion measures, including large OMOs and forex swaps, also boosted prices.
• Earlier in the week, bond prices witnessed fall due to strong domestic growth data and a weak rupee which had dimmed hopes of a rate cut by the RBI.
• In the weekly debt sale held on December 5, the RBI auctioned 6.48% GS 2035 for a total notified amount of Rs 32,000 crore.

Indian debt market indicators

 India yield curve shift (%) (W-o-W)*

Indian equity market updates

• Indian equities ended mixed this week, as earlier gains supported by strong domestic growth data and the 25-basis point RBI rate cut were capped due to profit booking and foreign fund outflows. The BSE Sensex closed higher at 0.01% and Nifty 50 slipped 0.06%.
• A few sectors ended higher with information technology, auto and metal gaining the most. The BSE IT rose 2.92%, BSE Auto 0.59% and BSE Metal 0.40%.
• The domestic market bought Rs 3,854 crores worth of equities on December 5, 2025, compared with buying of Rs 3,994 crores worth of equities on November 28, 2025.
• Foreign institutional investors sold equities worth Rs 1,682 crore on December 4, 2025, compared with selling of Rs 3,672 crores on November 28, 2025.

Global Equity market summary

• US stocks rose during the week, driven by expectations of a Fed interest rate cut and gains in tech and retail stocks.
• However, a few losses were witnessed due to the tariff drag on manufacturing and mixed labour market data.
• Britain's FTSE index declined during the week weighed down by selloff in mining, energy, industrial and financial stocks amid caution ahead of the US Fed policy meeting next week.
• However, a few gains were witnessed after tax-raising budget lifted investor sentiment and Bank of England's decision to ease capital requirements to support growth.
• Asian equities ended higher this week. Japan’s Nikkei index ended higher owing to gains in technology and artificial intelligence (AI)-related stocks amid Fed rate cut hopes.
• Investors remained cautious ahead of major central bank decisions next month.
• Hong Kong's Hang Seng Index ended higher on optimism over a possible rate cut by the US Fed and as weak Chinese manufacturing activity raised hopes for stimulus measures.
• China's Shanghai Composite Index closed higher this week due to optimism over a potential Fed rate cut and gains in non-ferrous metal and AI shares.
• Additionally, further gains were witnessed on renewed optimism surrounding domestic chipmakers.
• However, a few losses were witnessed as China's slowing services growth added to worries about an economy grappling with a prolonged property slump.

Global Yield

• US Treasury prices were down during the week as labour data showed resilience, slightly paring rate cut bets.
• Bond prices declined as recent labour market data pointed to a fairly resilient market, reinforcing view that the economy was not deteriorating sharply and slightly reducing the chances of an interest rate cut at next week's Federal Reserve (Fed) meeting. A few loses were also seen as investors consolidating positions ahead of the policy decision from the Fed's December 9-10 gathering.
• Bond prices also tracked weakness in Japanese and European government bonds following comments from Bank of Japan Governor Kazuo Ueda, who signalled that conditions were aligning for a possible rate hike.
• The yield on the 10-year benchmark Treasury bond ended at 4.11% on December 4 compared with 4.02% from November 28.

Major global bond yields

Commodities and Currency

• Crude oil prices rose during the week after US-Russia peace talks failed, keeping sanctions on Russian oil intact.
• Gold prices ended higher this week due to safe-haven demand amid expectations of a dovish Fed policy outlook.
• The rupee closed lower against the dollar this week, due to persistent dollar demand, foreign fund outflows and uncertainty over the US-India trade deal. However, a few gains were seen after the central bank’s policy rate cut.

Commodity prices

Other currencies vs the rupee

Global Economic

• US S&P Global Manufacturing PMI eased to 52.2 in November 2025, compared to 52.5 in October 2025 and Services PMI fell to 54.1 compared to 54.8 while Composite PMI slipped to 54.2 from 54.6.
• US Industrial Production increased 1.6% in September 2025 compared to the upwardly revised 0.84% rise in August 2025.
• Eurozone HCOB Manufacturing PMI slipped to 49.6 in November 2025 compared to 50 in October 2025.
• Eurozone Producer Prices decreased -0.5% in October 2025 compared to a -0.2% decline in September 2025.
• Eurozone consumer price inflation rose to 2.2% in November 2025, compared to 2.1% in October 2025 while the annual core inflation rate was at 2.4% for the third consecutive month.
• UK S&P Global Services PMI eased to 51.3 in November 2025 compared to 52.3 in October 2025 and the S&P Global Composite PMI fell to 51.2 from 52.2.
• UK S&P Global Manufacturing PMI rose to 50.2 in November 2025 compared to 49.7 in October 2025.
• China official NBS Manufacturing PMI edged up to 49.2 in November 2025 compared to 49.0 in October 2025 while the NBS Non-Manufacturing PMI eased to 49.5 from 50.1.
• China RatingDog General Manufacturing PMI eased to 49.9 in November 2025 compared to 50.6 in October 2025.
• Japan S&P Global Manufacturing PMI rose to 48.7 in November 2025 compared to a final 48.2 in October 2025.

Macro indicators

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