Story of 6 key macro signals for the week to September 06, 2025

8 Sep 2025 , 03:58 PM

THE WEEK WAS ABOUT SCO SUMMIT AND CAD

In a world where news becomes outdated in days, the tariff issue was relegated to the background as the focus shifted to India’s subtle counter to the US tariffs. Through the SCO Summit in Tianjin, India cosied up to China and Russia a little more.

The current account deficit for Q1FY26 was just 0.2% of GDP, something that will have a salutary impact on the rupee. However, global investors are still worried about the real impact of the 50% tariffs on India and the impact on $50 billion of exports to the US.

• US BOND YIELDS TREND LOWER FOR THE WEEK

The table captures US 10-year benchmark bond yields over the last 5 trading sessions.

Date	Price (%)	Open (%)	High (%)	Low (%)
Sep 05, 2025	4.086	4.157	4.168	4.061
Sep 04, 2025	4.176	4.211	4.225	4.157
Sep 03, 2025	4.211	4.269	4.300	4.201
Sep 02, 2025	4.277	4.256	4.306	4.244
Sep 01, 2025	4.253	4.252	4.280	4.232
Aug 31, 2025	4.237	4.228	4.237	4.228
Aug 29, 2025	4.226	4.209	4.242	4.207

Data Source: Bloomberg

The US bond yields had been on an uptrend over the last few weeks due to a demand-supply mismatch. However, this week saw the bond yields normalizing back to 4.086% levels. After all, the weak jobs data has made the 25-bps rate cut in September almost inevitable. Last week, US 10-year bond yields touched a high of 4.306% and a low of 4.061%.

• US DOLLAR INDEX (DXY) GIVES UP GAINS TO CLOSE FLAT

Here is the US dollar index (DXY), an index of dollar strength, over last 5 trading sessions.

Date	Price (%)	Open (%)	High (%)	Low (%)
Sep 05, 2025	97.77	98.24	98.26	97.43
Sep 04, 2025	98.35	98.15	98.44	98.08
Sep 03, 2025	98.14	98.40	98.64	98.01
Sep 02, 2025	98.40	97.65	98.60	97.62
Sep 01, 2025	97.77	97.83	97.87	97.54
Aug 29, 2025	97.77	97.87	98.13	97.69

Data Source: Bloomberg

The US dollar index (DXY) rallied to 98.6 levels during the week, but tapered and closed flat at 97.77. The dollar index continues to be under pressure, as de-dollarization continues to be the overpowering global trend. The US dollar index (DXY) touched a high of 98.64 and a low of 97.43 this week. The 100 level has been a resistance for some time now.

• INDIA BENCHMARK BOND YIELDS TAPER AFTER A RALLY

The table below captures 10-year India bond yields for the last 5 trading sessions.

Date	Price (%)	Open (%)	High (%)	Low (%)
Sep 05, 2025	6.463	6.473	6.492	6.459
Sep 04, 2025	6.494	6.544	6.544	6.490
Sep 03, 2025	6.541	6.566	6.567	6.539
Sep 02, 2025	6.569	6.585	6.592	6.566
Sep 01, 2025	6.585	6.569	6.623	6.569
Aug 29, 2025	6.588	6.553	6.615	6.536

Data Source: RBI

For the week, the India bond yields fell from 6.588% to 6.463% levels as the global yield spike reversed this week. The India bond yields are also pricing in one more rate cut by the RBI in October 2025. Last week, India 10-year bond yields touched a high of 6.623% and a low of 6.459%. Bond yields were in a tight range during the week, with downside bias.

• RUPEE WEAKENS TO ALL-TIME LOW ON HEDGING PRESSURE

The table captures the official USDINR exchange rate for last 5 trading sessions.

Date	Price (₹/$)	Open (₹/$)	High (₹/$)	Low (₹/$)
Sep 05, 2025	88.187	88.125	88.367	88.069
Sep 04, 2025	88.193	88.079	88.220	87.999
Sep 03, 2025	88.073	88.045	88.195	87.975
Sep 02, 2025	87.998	87.985	88.206	87.825
Sep 01, 2025	88.001	88.175	88.343	87.931
Aug 29, 2025	88.174	87.591	88.313	87.575

Data Source: RBI

USDINR weakened marginally from ₹88.174/$ to ₹88.187/$ for the week, but this glosses over the underlying weakness in the rupee. The dollar weakness sharpened due to tariffs, fiscal deficit outlook, and hedging pressure. Dollar demand from importers and borrowers persists. Last week, USDINR touched a high of ₹87.825/$ and a low of ͅ₹88.367/$.

• BRENT CRUDE WEAKENS ON SUPPLY CONCERNS

The table captures the Brent Crude prices over last 5 trading sessions.

Date	Price ($/bbl)	Open ($/bbl)	High ($/bbl)	Low ($/bbl)
Sep 05, 2025	65.50	66.82	67.05	65.07
Sep 04, 2025	66.99	67.41	67.41	66.35
Sep 03, 2025	67.60	69.10	69.24	67.36
Sep 02, 2025	69.14	68.19	69.53	68.05
Sep 01, 2025	68.15	67.42	68.36	67.12
Aug 29, 2025	68.12	68.24	68.39	67.90

Data Source: Bloomberg

The combination of more supplies by OPEC Plus and a rise in US crude inventories led to oil prices falling sharply during the week. With India persisting with Russian oil buying, the oil balance is likely to be maintained. Last week, Brent Crude touched a high of $69.53/bbl and a low of $65.07/bbl. More than demand, a supply glut is the big concern for crude oil.

• SPOT GOLD GLITTERS AT LIFE-TIME HIGHS

The table captures the international spot prices of gold in dollars per troy ounce (oz).

Date	Price ($/oz)	Open ($/oz)	High ($/oz)	Low ($/oz)
Sep 05, 2025	3,586.81	3,547.00	3,600.33	3,540.05
Sep 04, 2025	3,546.17	3,560.57	3,564.45	3,511.19
Sep 03, 2025	3,559.43	3,535.69	3,578.80	3,526.26
Sep 02, 2025	3,533.73	3,478.36	3,540.64	3,470.20
Sep 01, 2025	3,476.47	3,448.00	3,490.06	3,436.80
Aug 29, 2025	3,448.00	3,418.20	3,454.08	3,404.29

Data Source: Bloomberg

Spot gold prices spiked to $3,587/oz as the de-dollarization trend caught up and gave a boost to gold. Despite the gold/silver ratio favouring silver, safe-haven demand favours gold. During the week, gold touched a high of $3,600.33/oz and low of $3,436.80/oz. Another Fed rate cut is likely to reduce the opportunity cost of holding gold!