Weekly Economic Outlook: April 20-April 26, 2026
- Remin Francis I R
- 6 days ago
- 2 min read
The past week gave us a mixed picture, steady growth in some areas, but clear pressure building underneath, largely due to the ongoing Middle East conflict.
Let’s start with India. Infrastructure output slipped by 0.4% in March 2026, a sharp reversal from the 2.8% growth in February. This marks the first contraction since October and reflects how quickly global events can ripple into domestic data. The biggest hit came from energy-linked sectors, fertiliser production plunged 24.6%, while coal and crude oil output also declined. That said, construction-linked sectors like steel (2.2%) and cement (4%) are still holding up, which is a positive sign for ongoing infrastructure activity.
On the brighter side, business activity remains strong. The HSBC India Composite PMI rose to 58.3 in April, driven by solid momentum in both manufacturing and services. Manufacturing PMI climbed to 55.9, and Services PMI edged up to 57.9. Demand remains healthy, hiring is picking up, and companies are expanding, but rising input costs, especially fuel and raw materials, are starting to squeeze margins.
Globally, the impact of the Middle East war is becoming more visible. In Canada, inflation jumped to 2.4%, with gasoline prices surging 21.2% month-on-month. The UK is facing a similar trend; its inflation rose to 3.3%, driven largely by fuel and heating costs. Interestingly, UK unemployment fell to 4.9%, but this was partly because more people exited the workforce, not necessarily because more jobs were created.
Japan presents a slightly different story. Its trade surplus widened to JPY 667 billion, supported by strong exports, although inflation remains relatively contained at 1.5%, still below the central bank’s target.
Back home, India’s forex reserves rose to $703.31 billion, staying close to record highs. This provides a strong buffer against global volatility.
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