Banking Mantra

Economic Weekly Wrap
13 April 2026 - 17 Apr 2026

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  • 13 April 2026

    Global markets are expected to witness another volatile week after the US President announced a complete blockade of the Strait of Hormuz following the collapse of US-Iran peace talks. Oil prices are trading higher today, while Asian markets are trading in the red.

    On the macro front, US CPI rose by 0.9% month-on-month in Mar'26 after increasing by 0.3% in Feb'26, driven primarily by a sharp rise in gasoline prices. On a year-on-year basis, CPI accelerated to 3.3% in Mar'26 from 2.4% in Feb'26. The data follows comments from the US President indicating that oil and energy prices are likely to remain elevated until Nov'26.

    The University of Michigan Consumer Sentiment Index fell sharply to a record low of 47.6 in Apr'26 from 53.3 in Mar'26. Meanwhile, one-year inflation expectations surged to 4.8% from 3.8% in the previous month. Separately, the Asian Development Bank (ADB) revised India's FY27 GDP growth forecast upward to 6.9% from 6.5%, while cautioning that prolonged geopolitical tensions in the Middle East remain a key downside risk.


    Global equity markets ended on a mixed note as investors monitored developments in the Middle East. US markets declined modestly, while Asian markets advanced, with the Nikkei posting the strongest gains on the back of a weaker yen. In India, Sensex rose, led by gains in auto stocks. However, it is trading lower today, in line with other Asian markets, after the US announced the blockade of the Strait of Hormuz.

    Table 1 – Stock Markets

    09-04-2026 10-04-2026 Change, %
    Dow Jones48,18647,917(0.6)
    S & P 5006,8256,817(0.1)
    FTSE10,60310,6010.0
    Nikkei55,89556,9241.8
    Hang Seng25,75225,8940.5
    Shanghai Comp3,9663,9860.5
    Sensex76,63277,5501.2
    Nifty23,77524,0511.2

    Source: Bloomberg, Bank of Baroda Research


    Global currencies ended mixed. The DXY softened as investors awaited the outcome of peace talks. Among major currencies, the euro and the British pound gained 0.2% each. The INR depreciated marginally despite lower crude oil prices. However, it is trading weaker today, in line with other Asian currencies, following the collapse of US-Iran peace talks.

    Table 2 – Currencies

    09-04-2026 10-04-2026 Change, %
    EUR/USD1.16991.17230.2
    GBP/USD1.34361.34620.2
    USD/JPY158.96159.27(0.2)
    USD/INR92.6692.73(0.1)
    USD/CNY6.83076.82920.0
    DXY Index98.8298.65(0.2)

    Source: Bloomberg, Bank of Baroda Research


    Except for India, where yields declined, and China, where they remained unchanged, major global 10Y bond yields moved higher. The UK's 10Y yield recorded the sharpest increase, followed by Germany, reflecting improved risk sentiment. India's 10Y G-Sec yield fell by 5bps. However, the cutoff yield for the 6.48% GS 2035 security was 25bps higher in the latest auction, and the benchmark 10Y yield is trading higher today at around 6.97%.

    Table 3 – Bond 10Y Yield

    09-04-2026 10-04-2026 Change, bps
    US4.284.324
    UK4.754.849
    Germany2.993.067
    Japan2.392.445
    China1.811.810
    India6.966.91(5)

    Source: Bloomberg, Bank of Baroda Research


    Table 4 – Short Term Rates

    09-04-2026 10-04-2026 Change, bps
    Tbill-91 days5.265.25(1)
    Tbill-182 days5.395.434
    Tbill-364 days5.605.600
    G-Sec 2Y6.116.09(3)
    India OIS-2M5.345.33(1)
    India OIS-9M5.675.65(2)
    SONIA int rate benchmark3.733.730
    US SOFR3.593.57(2)

    Source: Bloomberg, Bank of Baroda Research


    Banking system liquidity improved further, with net surplus liquidity rising to Rs 5.5 tn on 10 Apr 2026 from Rs 4.6 tn in the previous session.

    Table 5 – Liquidity

    Rs tn 09-04-2026 10-04-2026 Change (Rs tn)
    Net Liquidity (-deficit/+surplus) 4.6 5.5 0.9

    Source: RBI, Bank of Baroda Research


    Table 6 – Capital Market Flows

    08-04-2026 09-04-2026 Change (US$ mn/Rs cr)
    FII (US$ mn) (148.0) (239.2) (91.2)
       Debt 2.7 (16.6) (19.3)
       Equity (150.8) (222.7) (71.9)
    Mutual Funds (Rs cr) 6,112.9 9,630.5 3,517.6
       Debt 31.4 5,946.2 5,914.8
       Equity 6,081.5 3,684.4 (2,397.1)

    Source: Bloomberg, Bank of Baroda Research | Note: Mutual Fund data as of 6 Apr & 7 Apr 2026.


    Oil prices were marginally lower during the session but are trading significantly higher today after the US-Iran peace talks ended without a resolution.

    Table 7 – Commodities

    09-04-2026 10-04-2026 Change, %
    Brent crude (US$/bbl) 95.9 95.2 (0.8)
    Gold (US$/ Troy Ounce) 4,766.9 4,749.8 (0.4)
    Copper (US$/ MT) 12,585.9 12,819.4 1.9
    Zinc (US$/ MT) 3,304.5 3,322.5 0.5
    Aluminium (US$/ MT) 3,444.0 3,498.5 1.6

    Source: Bloomberg, Bank of Baroda Research

  • 15 Apr 2026

    Global markets cheered reports of renewed peace talks between the US and Iran, although persistent uncertainty continued to cloud the global growth outlook. The IMF revised its global growth forecast lower to 3.1% for 2026 and 3.2% for 2027 under its reference scenario, which assumes that geopolitical tensions remain short-lived and normalcy returns by H2 2026. Under this scenario, crude oil prices are expected to average US$82/bbl in 2026 and US$75/bbl in 2027, while global inflation is projected to edge up to 4.4% in 2026 from 4.1% in 2025.

    The IMF also outlined alternative scenarios based on the duration of the conflict. Under the adverse scenario, oil prices are expected to average US$100/bbl in 2026 and US$75/bbl in 2027, with global GDP growth slowing to 2.5% in 2026 and 2.7% in 2027. Under the severe scenario, global growth could decelerate further to 2.0% in 2026 and 2.2% in 2027, while oil prices could rise to US$110/bbl in 2026 and US$125/bbl in 2027. For India, the IMF marginally revised FY26 GDP growth upward to 6.5% from 6.4%.


    Global equity markets ended higher amid optimism surrounding a second round of peace talks between the US and Iran, helping offset concerns over an escalating energy crisis following the blockade of the Strait of Hormuz. The Nikkei posted the strongest gains, followed by US markets. Indian markets were closed on 14 Apr 2026 on account of a holiday. However, Sensex is trading higher today in line with gains across other Asian markets.

    Table 1 – Stock Markets

    13-04-2026 14-04-2026 Change, %
    Dow Jones48,21848,5360.7
    S & P 5006,8866,9671.2
    FTSE10,58310,6090.2
    Nikkei56,50357,8772.4
    Hang Seng25,66125,8720.8
    Shanghai Comp3,9894,0271.0
    Sensex77,55076,848(0.9)
    Nifty24,05123,843(0.9)

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Global currencies ended mostly stronger as improving risk sentiment weighed on the US dollar. The DXY index declined by 0.2%, while the British pound posted the strongest gains. Indian financial markets were closed on 14 Apr 2026. The INR is trading stronger today, broadly in line with other Asian currencies.

    Table 2 – Currencies

    13-04-2026 14-04-2026 Change, %
    EUR/USD1.17591.17960.3
    GBP/USD1.35061.35670.5
    USD/JPY159.45158.790.4
    USD/INR92.7393.38(0.7)
    USD/CNY6.83026.81580.2
    DXY Index98.3798.12(0.2)

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Major global 10Y bond yields mostly declined. The UK's 10Y yield recorded the sharpest fall as Bank of England officials highlighted downside risks to growth, while Germany's yield also eased after the ECB President indicated that growth could undershoot the baseline forecast. India's benchmark 10Y G-Sec yield rose by 3bps following inflation data, although it is trading lower today at around 6.89%.

    Table 3 – Bond 10Y Yield

    13-04-2026 14-04-2026 Change, bps
    US4.294.25(5)
    UK4.874.78(9)
    Germany3.093.02(7)
    Japan2.472.42(5)
    China1.801.79(1)
    India6.916.943

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Table 4 – Short Term Rates

    10-04-2026 13-04-2026 Change, bps
    Tbill-91 days5.255.272
    Tbill-182 days5.435.463
    Tbill-364 days5.605.58(2)
    G-Sec 2Y6.096.06(3)
    India OIS-2M5.335.30(3)
    India OIS-9M5.655.661
    SONIA int rate benchmark3.733.730
    US SOFR3.613.632

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Banking system liquidity eased marginally, with net surplus liquidity declining to Rs 5.2 tn on 13 Apr 2026 from Rs 5.5 tn in the previous session.

    Table 5 – Liquidity

    Rs tn 10-04-2026 13-04-2026 Change (Rs tn)
    Net Liquidity (-deficit/+surplus) 5.5 5.2 (0.3)

    Source: RBI, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Table 6 – Capital Market Flows

    09-04-2026 10-04-2026 Change (US$ mn/Rs cr)
    FII (US$ mn) (239.2) 114.0 353.2
       Debt (16.6) (48.9) (32.4)
       Equity (222.7) 162.9 385.6
    Mutual Funds (Rs cr) 9,774.9 6,682.4 (3,092.5)
       Debt 4,830.1 1,195.3 (3,634.8)
       Equity 4,944.7 5,487.0 542.3

    Source: Bloomberg, Bank of Baroda Research | Note: Mutual Fund data as of 6 Apr & 7 Apr 2026. Markets in India were closed on 14 Apr 2026.


    Oil prices softened amid renewed hopes of a ceasefire between the US and Iran.

    Table 7 – Commodities

    13-04-2026 14-04-2026 Change, %
    Brent crude (US$/bbl) 99.4 94.8 (4.6)
    Gold (US$/ Troy Ounce) 4,740.3 4,841.8 2.1
    Copper (US$/ MT) 12,996.4 13,253.0 2.0
    Zinc (US$/ MT) 3,297.6 3,322.4 0.8
    Aluminium (US$/ MT) 3,607.5 3,563.0 (1.2)

    Source: Bloomberg, Bank of Baroda Research

  • 16 Apr 2026

    Global markets witnessed a realignment in risk sentiment following reports of a two-week extension of the ceasefire between the US and Iran. Equity markets found some relief amid hopes of a sustained truce, while sovereign bonds witnessed selling pressure. Crude oil and gold prices traded within a narrow range as investors assessed geopolitical developments.

    On the macro front, the US Federal Reserve's Beige Book indicated that the ongoing conflict in the Middle East has heightened uncertainty around the business outlook. As a result, companies remain cautious regarding hiring, pricing decisions, and capital expenditure. In China, Q1CY26 GDP expanded by 5.0%, marking the strongest growth in the past three quarters. Industrial production also accelerated to 5.7% YoY in Mar'26, although retail sales moderated to 1.7%. Inflationary pressures remained contained despite geopolitical tensions.

    On the domestic front, India's merchandise exports grew by 4.2% to US$860.1bn in FY26, while imports rose at a faster pace of 6.5% to US$979bn. Consequently, the trade deficit widened to US$119bn in FY26 from US$94.7bn in FY25.


    Except for the Dow Jones and FTSE, major global equity indices closed higher as investors monitored improving prospects of further negotiations between the US and Iran. Market attention is gradually shifting towards corporate earnings and macroeconomic data. Sensex emerged as the top performer among major indices, led by gains in consumer durable and power stocks. It is trading higher today, in line with gains across other Asian markets.

    Table 1 – Stock Markets

    14-04-2026 15-04-2026 Change, %
    Dow Jones48,53648,464(0.1)
    S & P 5006,9677,0230.8
    FTSE10,60910,560(0.5)
    Nikkei57,87758,1340.4
    Hang Seng25,87225,9470.3
    Shanghai Comp4,0274,0270.0
    Sensex76,84878,1111.6
    Nifty23,84324,2311.6

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Global currencies traded in a narrow range. The DXY index edged higher despite optimism surrounding a potential peace agreement and easing inflation concerns. The Indian rupee closed unchanged, although it is trading stronger today while other Asian currencies are showing mixed performance.

    Table 2 – Currencies

    14-04-2026 15-04-2026 Change, %
    EUR/USD1.17961.17990.0
    GBP/USD1.35671.35610.0
    USD/JPY158.79159.00(0.1)
    USD/INR93.3893.380.0
    USD/CNY6.81586.81900.0
    DXY Index98.1298.230.1

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Global 10Y bond yields edged higher as improving risk sentiment reduced demand for safe-haven assets. The US and UK recorded the largest increase in yields, while China's 10Y yield declined marginally following key macroeconomic releases. India's benchmark 10Y G-Sec yield declined by 7bps amid optimism over a potential end to the conflict and is trading around 6.89% today.

    Table 3 – Bond 10Y Yield

    14-04-2026 15-04-2026 Change, bps
    US4.254.284
    UK4.784.813
    Germany3.023.042
    Japan2.422.420
    China1.791.78(1)
    India6.946.87(7)

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Table 4 – Short Term Rates

    14-04-2026 15-04-2026 Change, bps
    Tbill-91 days5.275.20(7)
    Tbill-182 days5.465.471
    Tbill-364 days5.585.580
    G-Sec 2Y6.065.98(8)
    India OIS-2M5.305.28(2)
    India OIS-9M5.665.62(4)
    SONIA int rate benchmark3.733.730
    US SOFR3.633.663

    Source: Bloomberg, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Banking system liquidity remained stable, with net surplus liquidity unchanged at Rs 5.2 tn on 15 Apr 2026.

    Table 5 – Liquidity

    Rs tn 13-04-2026 15-04-2026 Change (Rs tn)
    Net Liquidity (-deficit/+surplus) 5.2 5.2 0

    Source: RBI, Bank of Baroda Research | Note: Markets in India were closed on 14 Apr 2026.


    Table 6 – Capital Market Flows

    10-04-2026 13-04-2026 Change (US$ mn/Rs cr)
    FII (US$ mn) 114.0 (179.0) (293.0)
       Debt (48.9) (25.3) 23.7
       Equity 162.9 (153.7) (316.7)
    Mutual Funds (Rs cr) 9,774.9 6,682.4 (3,092.5)
       Debt 4,830.1 1,195.3 (3,634.8)
       Equity 4,944.7 5,487.0 542.3

    Source: Bloomberg, Bank of Baroda Research | Note: Mutual Fund data as of 6 Apr and 7 Apr 2026. Markets in India were closed on 14 Apr 2026.


    Crude oil prices edged up marginally but remained below the US$95/bbl mark amid hopes of further de-escalation of the West Asia conflict.

    Table 7 – Commodities

    14-04-2026 15-04-2026 Change, %
    Brent crude (US$/bbl)94.894.90.1
    Gold (US$/ Troy Ounce)4,841.84,791.0(1.0)
    Copper (US$/ MT)13,253.013,188.7(0.5)
    Zinc (US$/ MT)3,322.43,386.21.9
    Aluminium (US$/ MT)3,563.03,621.51.6

    Source: Bloomberg, Bank of Baroda Research

  • 17 Apr 2026

    Global markets monitored developments around the ceasefire as the US President announced that Israel and Lebanon had agreed to a 10-day ceasefire. Equity markets responded positively, with major US and Asian indices posting gains. However, crude oil prices continued to remain elevated, hovering just below the US$100/bbl mark as supply constraints persisted. Gold prices remained range-bound, supported by the strength in the US dollar.

    On the macro front, US initial jobless claims declined to 207,000 for the week ending 11 Apr'26, signalling continued resilience in the labour market. However, industrial production declined sequentially and capacity utilisation eased, reflecting supply-side bottlenecks. In the UK, monthly GDP expanded in Feb'26, supported by stronger services activity, while the manufacturing sector remained weak. On the domestic front, investors are closely watching the weekly government securities auction for further cues on the direction of bond yields.


    Except for Indian markets, major global equity indices ended higher as investors awaited further clarity on the ceasefire negotiations between the US and Iran. Better-than-expected macroeconomic data, including US jobless claims and GDP releases from both the US and China, also supported sentiment. Sensex declined modestly, led by losses in auto, banking and oil & gas stocks. However, it is trading higher today, while most Asian markets are trading lower.

    Table 1 – Stock Markets

    15-04-2026 16-04-2026 Change, %
    Dow Jones48,46448,5790.2
    S & P 5007,0237,0410.3
    FTSE10,56010,5900.3
    Nikkei58,13459,5182.4
    Hang Seng25,94726,3941.7
    Shanghai Comp4,0274,0560.7
    Sensex78,11177,989(0.2)
    Nifty24,23124,197(0.1)

    Source: Bloomberg, Bank of Baroda Research


    The US dollar strengthened, with the DXY Index rising by 0.2% on the back of resilient labour market data. The euro and the British pound weakened the most among major currencies. The INR appreciated by 0.2%, supported by reports that the RBI had provided a special credit line to oil marketing companies (OMCs) to meet their foreign exchange requirements. It is trading stronger today, while other Asian currencies are trading weaker.

    Table 2 – Currencies

    15-04-2026 16-04-2026 Change, %
    EUR/USD1.17991.1781(0.2)
    GBP/USD1.35611.3527(0.3)
    USD/JPY159.00159.17(0.1)
    USD/INR93.3893.200.2
    USD/CNY6.81906.8226(0.1)
    DXY Index98.0698.220.2

    Source: Bloomberg, Bank of Baroda Research


    Global 10Y bond yields ended mixed. US and UK yields edged higher following stronger macroeconomic data, while yields in other major markets remained broadly stable amid expectations of further negotiations between the US and Iran. India's 10Y G-Sec yield rose by 2bps, tracking higher crude oil prices, and is trading around 6.91% today.

    Table 3 – Bond 10Y Yield

    15-04-2026 16-04-2026 Change, bps
    US4.284.313
    UK4.814.853
    Germany3.043.03(1)
    Japan2.422.41(1)
    China1.781.780
    India6.876.892

    Source: Bloomberg, Bank of Baroda Research


    Table 4 – Short Term Rates

    15-04-2026 16-04-2026 Change, bps
    Tbill-91 days5.205.16(4)
    Tbill-182 days5.475.37(10)
    Tbill-364 days5.585.55(3)
    G-Sec 2Y5.985.97(1)
    India OIS-2M5.285.280
    India OIS-9M5.625.631
    SONIA int rate benchmark3.733.730
    US SOFR3.663.726

    Source: Bloomberg, Bank of Baroda Research


    Liquidity in the banking system moderated, with net surplus liquidity declining to Rs 4.1 tn on 16 Apr 2026 from Rs 5.2 tn in the previous session.

    Table 5 – Liquidity

    Rs tn 15-04-2026 16-04-2026 Change (Rs tn)
    Net Liquidity (-deficit/+surplus) 5.2 4.1 (1.1)

    Source: RBI, Bank of Baroda Research


    Table 6 – Capital Market Flows

    13-04-2026 15-04-2026 Change (US$ mn/Rs cr)
    FII (US$ mn) (179.0) 180.2 359.2
       Debt (25.3) (151.7) (126.4)
       Equity (153.7) 331.8 485.6
    Mutual Funds (Rs cr) 9,774.9 6,682.4 (3,092.5)
       Debt 4,830.1 1,195.3 (3,634.8)
       Equity 4,944.7 5,487.0 542.3

    Source: Bloomberg, Bank of Baroda Research | Note: Mutual Fund data as of 6 Apr & 7 Apr 2026.


    Crude oil prices surged by nearly 5% as shipping activity through the Strait of Hormuz remained close to a standstill, raising concerns over supply disruptions. Gold prices remained broadly unchanged, while base metals ended mixed.

    Table 7 – Commodities

    15-04-2026 16-04-2026 Change, %
    Brent crude (US$/bbl) 94.9 99.4 4.7
    Gold (US$/ Troy Ounce) 4,791.0 4,790.1 0.0
    Copper (US$/ MT) 13,188.7 13,206.2 0.1
    Zinc (US$/ MT) 3,386.2 3,418.4 1.0
    Aluminium (US$/ MT) 3,621.5 3,643.5 0.6

    Source: Bloomberg, Bank of Baroda Research

Economics Scenario

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