Economy Tracker: Markets update; IN Mar INR REER; IMF GDP forecasts; Feb RBI FX intervention; Apr RBI policy minutes; Mar core IIP by Kotak Institutional Equities
Money market and bond market during the week
* Banking sector liquidity in India was at a surplus of Rs1 tn on April 24 compared to a surplus of Rs1.7 tn on April 16. The weighted average call rate (WACR) was at 5.85% on April 24 (5.76% on April 16).
* Government cash balances with the RBI (estimated) was at Rs(-)89 bn on April 18; lower than Rs(-)30 bn on April 11.
* Indian 1-year T-bill was at 5.93% on April 25 (5.94% on April 17). The Indian 5-year G-sec yield was at 6.08% on April 25 (6.05% on April 17).
* Indian 10-year G-sec yield was at 6.36% on April 25 (6.37% on April 17).
* 1-year OIS was at 5.72% on April 25 (5.73% on April 17). 2-year OIS was at 5.57% on April 25 (5.56% on April 17).
FX market during the week
* Dollar index (DXY) was around 99.6 on April 25 against 99.4 on April 17. EUR-USD fell around 0.3% to 1.136 on April 25 from end of last week while GBP-USD gained around 0.2% to 1.332. USD-JPY fell around 0.8% to around 143.4.
* USD-INR was at 85.4 on April 25 (85.4 on April 17).
* INR 1-year forward premium was at 2.16% on April 25 (2.09% on April 17).
Equity market during the week
* Nifty-50 index gained 0.8% on April 25 from closing of last week while Nifty mid-cap. index gained 1.3% and small-cap. index gained 0.5%. Broader market index (Nifty-500) gained 0.8% from closing of last week.
Commodities market during the week
* Brent crude oil prices was around US$67.3/bbl on April 25 compared to around US$68.1/bbl on April 17.
* Gold prices decreased around 1% over the week to around US$3295/oz on April 25. Copper prices (LME index) increased around 2.6% as on April 25 over end of last week.
Key events/data releases during the week
* INR REER dipped to 101.5 in March from 102.4 in February. In the same period, INR moved to average around 86.5 against USD in March from 87 in February while CPI inflation moved down to 3.3% in March from 3.6% in February.
* IMF revised India’s real GDP growth forecast to 6.2% for FY2026 (30 bps lower than January estimate) and 6.3% for FY2027 (revised down by 20 bps). Global growth has been revised down by 50 bps to 2.8% for CY2025 and by 30 bps to 3% for CY2026.
* In February, the RBI purchased US$45 bn and sold US$46.6 bn in spot FX markets (net sale of US$1.6 bn in February after net sale of US$11.1 bn in January). Forward position was net short US$89 bn in February (January: net short at US$78 bn).
* In the minutes of RBI’s April policy, all MPC members unanimously expressed the need to support growth in an uncertain external environment, even as domestic conditions remain healthy. Most MPC members pointed out that spillovers to domestic growth are from external channels, and weak consumer and investor confidence. Governor stated that while at 6.5% growth India would continue to be the fastest-growing major economy, it is lower than aspirations.
* Infrastructure output (weight of 40.3% in IIP) growth in March 2025 was at 3.8% (February: 3.4%). Cement production growth was at 11.6% (February: 10.8%), followed by, fertilizers production growth at 8.8% (10.2%), steel production growth at 7.1% (6.9%), electricity production growth at 6.2% (3.6%), coal production growth was at 1.6% (1.7%), and refinery products’ production growth at 0.2% (0.8%). On the other hand, crude oil production growth was at (-)1.9% (February: (-)5.2%) and natural gas production at (-)12.7% ((-)6%)
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