Global Trade & Macro Updates — Impact on India
The US and China have reached a framework deal to avert 100% tariffs and pause rare earth export curbs, easing global trade tensions. Simultaneously, the US has signed fresh trade and minerals agreements with Malaysia, Cambodia and Thailand to diversify supply chains away from China. However, Trump has imposed an additional 10% tariff on Canadian imports.
US September CPI came in at 3.0% YoY — slightly below estimates — strengthening market expectations of a Fed rate cut. Japan’s services inflation rose to 3%, indicating improving domestic demand.
India and the US are close to sealing a long-pending bilateral trade deal, awaiting final approval. Meanwhile, India has identified 26 new markets to expand rice export reach, including Indonesia, Japan and Vietnam.
Domestically, festive demand was very strong — record Diwali sales across premium smartphones, TVs and appliances, aided by tax cuts and easy credit. On macro data, Services PMI eased to 58.8 (5-month low) while Manufacturing PMI rose to 58.4, showing continued industry strength. Private capex outlays almost doubled in Q2 FY26 to ₹10.5 trillion, signaling strong corporate investment recovery.
Impact on India 🇮🇳
• Export outlook improves for IT, pharma, auto and electronics amid easing US–China tensions and nearing US–India trade deal.
• FPI inflows may strengthen on better global risk sentiment.
• Manufacturing and minerals sectors gain as global supply chains diversify away from China.
• Festive demand supports consumption-led GDP momentum.
• Strong rise in private investment signals sustained infra and industrial expansion.
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