Weekly Economic Outlook: August 04-August 10, 2025
- Remin Francis I R
- Aug 11
- 2 min read
India’s growth momentum held strong in July. The HSBC India Composite PMI stayed at 61.0, unchanged from June but still the highest since April 2024. Services activity expanded at its fastest in 11 months, while manufacturing hit an 18-month high. New orders jumped at the quickest pace since April 2024, though hiring slowed to a 15-month low. Price pressures picked up, with output inflation above its long-term average, but optimism faded as the Future Output Index slipped to its weakest since March 2023.
The HSBC India Services PMI was revised up to 60.5, just above June’s 60.4. Strong demand came from Asia, Canada, Europe, the UAE, and the US. Backlogs grew at the fastest pace in nearly five years, pointing to capacity constraints. Prices rose faster than in June, but sentiment stayed upbeat, supported by tech adoption, marketing, and a stronger online presence.
On policy, the RBI kept the repo rate at 5.50% in August, maintaining GDP growth forecasts at 6.5% for FY2025/26 and trimming inflation projections to 3.1%. Forex reserves slipped to $688.87B from $698.19B the week before.
In the United States, ISM Services PMI fell to 50.1 in July from 50.8 in June, missing expectations of 51.5. Seasonal and weather-related slowdowns hit business activity, new orders, and inventories. Tariff impacts were a recurring theme, while employment shrank for the second straight month.
China’s trade surplus stood at $98.24B in July, above last year’s level but below forecasts. Exports surged 7.2% YoY, supported by eased tariff pressure, while imports rose 4.1% against expectations of a fall. Inflation stayed flat YoY in July, defying forecasts of a drop, with core inflation climbing to a 17-month high at 0.8%.
The Bank of England cut interest rates by 25 bps to 4%, its lowest since March 2023, in a rare two-round vote. Growth forecasts for 2025 were nudged up to 1.25%, but inflation is still expected to peak at 4% in September.
In Canada, the unemployment rate held at 6.9% in July, just below a near four-year high. Youth unemployment climbed to 14.6%, the highest since 2010 (excluding the pandemic), while net employment fell by 40.8k, the sharpest drop since 2022.
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