Weekly Global & Indian Market Update – August 1, 2025

News This Week – 01st August 2025

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1. India’s Industrial Growth Slows in June 2025

India’s Industrial Production (YoY) rose by just 1.5% in June 2025, marking the slowest expansion in ten months. The marginal growth was supported by manufacturing, which expanded 3.9%, while mining and electricity sectors saw sharp declines of 8.7% and 2.6% respectively. Only 15 out of 23 manufacturing segments posted positive growth, signaling sectoral weakness. We attribute the subdued performance to the early onset of monsoon rains, which hampered mining and electricity output.

2. US Job Openings Fall Sharply in June 2025

US JOLTS Job Openings dropped to 7.44 million in June 2025, well below market expectations of 7.55 million and down from 7.71 million in May. The decline was driven by steep reductions in the accommodation and food services sector, as well as health care and finance. Hiring also slowed, with 5.2 million new hires recorded—the lowest rate since November 2024. Despite the pullback in job openings, quits and layoffs remained steady, pointing to a labor market that is cooling but not in crisis.

3. US GDP Jumps 3% in Q2 2025, Led by Imports Decline

The US economy rebounded sharply in Q2 2025, with real GDP rising at an annualized rate of 3.0%, following a 0.5% contraction in the previous quarter. This performance beat market expectations and was primarily driven by a steep 30% drop in imports, which boosted the GDP calculation, while consumer spending rose by 1.4%—up from 0.5% in Q1—but marked its slowest pace since 2022. Growth in investment and exports, however, remained tepid, and underlying domestic demand remained soft, with “final sales to private domestic purchasers” up only 1.2%

4. Fed Holds Rates Steady, Signals Wait-and-See Approach

The US Federal Reserve left its benchmark interest rate unchanged at 4.25%–4.50% during its July meeting, marking a fifth straight pause. The decision saw a rare 9-2 split, with two officials favouring a cut, underscoring internal divisions. Chair Jerome Powell stressed that controlling inflation is still the top priority, offering no hints of a rate cut in September. This cautious tone dampened hopes for imminent easing, and equity markets responded with mild declines.

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Upcoming Economic Events (Week Ahead)

India:

• S&P Global Services PMI (Jul) – August 5

• Interest Rate Decision – August 6

• FX Reserves (USD) – August 8

United States:

• S&P Global Services PMI (Jul) – August 5

• ISM Non-Manufacturing PMI (Jul) – August 5

• Crude Oil Inventories – August 6

• Initial Jobless Claims – August 7

• Nonfarm Productivity (QoQ) (Q2) – August 7

• Fed’s Balance Sheet – August 8

United Kingdom:

• BoE Interest Rate Decision – August 7