Finnovate Weekly Capsule (Oct 5–Oct 9, 2026)

Written by Finnovate

Finnovate’s editorial team researches and creates financial content using trusted sources, regulatory references and inputs from subject experts.

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The RBI raised the repo rate by 25 basis points to 5.50% this week, its first hike since February 2023, and shifted its stance to Calibrated Tightening. Nifty ended an eight-week losing streak, the longest in 25 years, with a 0.44% weekly gain to 22,520.45, even after the Sensex touched a 32-month low on Thursday. India's forex reserves fell for a fourth straight week to $734.61 billion, and the India 10-year yield reached 7.31%, a three-year high. Here is what mattered this week and why it matters to you.

Global and Geopolitical

1. Brent holds near $104 as Hormuz risk persists: Friday range of $102.50 to $104

• Brent crude traded between $102.50 and $104 a barrel on Friday, compared with a $102.25 settlement a week earlier and $103.63 on September 18. Prices eased marginally after President Trump said on October 8 that the US was holding productive discussions with Iran and would not resume strikes before the November 3 midterms. Movement of tankers through the Strait of Hormuz remains disrupted, and the wider concerns include higher supply and insurance costs and the depletion of Strategic Petroleum Reserves.
• Why it matters to you: Brent near $103 with the rupee near ₹97 keeps India's rupee-denominated crude cost close to the highest of this cycle. The import bill, the trade deficit and inflation all feel that pressure, which is why crude features in the RBI's reasoning for this week's rate hike.

2. India's Russian crude purchases fall to the lowest since March 2022: price, not policy, is the main driver

• Bloomberg tanker-tracking data show Russian crude flows to India averaged about 310,000 barrels per day over the four weeks to October 4, the lowest four-week level since March 2022. Kpler data show Russia's share of India's crude imports at about 35% in September, down from a peak of 56% in July.
• The reported driver is economics. Urals loaded at Baltic ports was offered at a premium of more than $10 a barrel to Dated Brent, which erased the discount that made it attractive, while Gulf supplies recovered and China competed harder for Russian cargoes. The US sanctions law allowing tariffs of up to 100% on large buyers of Russian oil added caution, but the report says economics rather than tariffs is the main reason and that India has reportedly not told refiners to cut imports. The shift may reduce India's exposure to that tariff risk, though a return of wide Russian discounts could reverse it.

3. US suspends PERM filings for eight companies including TCS and Infosys; India objects to Vance's remarks

• The US suspended Permanent Labour Certification (PERM) applications for eight companies: Infosys, TCS, Wipro, HCLTech, Microsoft, Adobe, Capgemini and Cognizant. Vice President JD Vance described foreign professionals as "indentured servants" and alleged that H-1B workers are paid less than US citizens in comparable roles. India's Ministry of External Affairs opposed the suspension, called the terminology deeply offensive, and stressed that PERM is distinct from the H-1B programme.
• According to the MEA, the suspension does not by itself affect the validity of existing H-1B visas or the status of H-1B holders and their dependents. It may, however, delay the green card process for eligible employees of the named companies. The immediate effect is therefore on long-term career pathways for affected employees rather than on current visa status.

Indian Macro

4. RBI hikes repo rate 25 bps to 5.50%: first hike since February 2023; stance shifts to Calibrated Tightening

• On October 7 the RBI's Monetary Policy Committee raised the repo rate by 25 basis points to 5.50%, after holding it at 5.25% in August. The Standing Deposit Facility rate moves to 5.25% and the MSF and Bank Rate to 5.75%. The committee also changed its stance from Neutral to Calibrated Tightening, which signals a direction rather than a one-off move, and near-term rate cuts are now effectively off the table.
• Why it matters to you: The RBI linked the move to renewed inflation pressure from higher crude and a weaker rupee, and said it aims to bring inflation to its 4% medium-term target. Floating-rate loans linked to the repo rate may reprice upward as lenders pass on the increase, while the 10-year bond yield rose to a three-year high by Friday (see story 16).

5. RBI lifts FY27 GDP forecast by 40 bps to 7.1% but raises CPI projection by 20 bps to 5.2%

• Alongside the rate decision, the MPC raised its FY27 real GDP growth projection by 40 basis points to 7.1%, citing strong consumer demand and robust Q1 growth. It also raised its FY27 CPI inflation projection by 20 basis points to 5.2%, with rising food prices the main driver.
• A stronger growth outlook gives the RBI room to tighten without signalling concern about demand, but a CPI projection of 5.2% sits well above the 4% target. The below-normal monsoon (story 9) adds to food price risk, which may help explain why the committee paired a growth upgrade with a tighter stance.

6. Forex reserves fall $12.95 billion to $734.61 billion: fourth straight weekly decline, about $51 billion below the peak

• India's foreign exchange reserves fell $12.95 billion to $734.61 billion in the week ended October 2, the fourth consecutive weekly decline. Reserves are about $51.1 billion below the record $785.7 billion reached in the week ended September 4. Foreign currency assets fell $10.66 billion to $604.75 billion and gold holdings fell $2.29 billion to $106.41 billion.
• Market estimates put the RBI's net dollar sales at about $30 billion in September as it defended the rupee against crude-driven pressure. Reserves remain $43.5 billion above their end-March 2026 level, so the buffer is still large, but the pace of drawdown shows how much support the currency has needed.

7. GST Council's 57th meeting recommends system-based refunds and wider ITC eligibility

• The 57th GST Council meeting on October 8 recommended a 90% provisional refund through system-based approval, automatic sanction of excess cash ledger refunds, and processing without officer intervention. For inverted duty refunds, ITC on input services would be refundable for credits availed from November 1, 2026, and ITC on capital goods would be refunded in 60 monthly instalments for credits availed from April 1, 2027.
• On ITC, the Council recommended removing restrictions on employee health and life insurance, telecom towers, pipelines laid outside factory premises, free samples, and goods written off on expiry where the law requires their destruction. These are recommendations that still need legal amendments and notifications, so the final scope and timing will depend on the detailed rules. If implemented, faster refunds may ease working capital for exporters and manufacturers, and wider ITC could lower costs for businesses that provide employee insurance.

8. Domestic air passenger traffic contracts for a fourth straight month

• Domestic air passenger traffic has contracted for four months in a row. DGCA data confirm that August traffic fell 6.34% to 121.26 lakh passengers. Industry figures cited in the source put the contraction at about 1% in June, then roughly 5%, 6% and 7% in the following three months, with the September figure a preliminary estimate.
• Most airlines have deliberately cut capacity to avoid adding to losses amid higher fuel costs and a weak rupee. Fewer seats can keep fares firm even as demand softens, which can weigh on passenger numbers further. The October to November festival period will test whether demand recovers.

9. IMD: monsoon ends 12.6% below the long period average, the weakest since 2015

• The 2026 southwest monsoon ended with a 12.6% rainfall deficit against the long period average, the weakest since 2015, and the IMD expects October rainfall to be below normal as well. Kharif output has not been hit hard, but Rabi output is expected to fall well below last year's level.
• The source points to rural demand strain already visible in tractor sales and weaker rural FMCG volumes. A smaller Rabi crop may add to food prices at a time when the RBI has raised its FY27 CPI projection to 5.2%, so the monsoon deficit links directly to both inflation and consumption in the coming months.

10. NPCI likely to defer the 0.4% UPI MDR to January 2027 after retailer pushback

• NPCI is considering deferring the 0.4% Merchant Discount Rate on UPI payments, due to start on October 15, to January 2027. Merchant associations, fintech firms and payment companies asked for the delay, and a decision could follow discussions with the Finance Ministry, according to media reports. The charge applies to high-value person-to-merchant payments above ₹2,000.
• Retailers argued the charge could dent festival-season sales, and several small vendors have told customers they would prefer cash to avoid it. Last month the FMCG distributors' federation had written to the Prime Minister seeking zero MDR on retail UPI, so the pushback has widened across merchant segments. Any deferral would postpone the question of who bears the cost of UPI rather than settle it.

11. India's apparel market projected to reach $146.3 billion by 2029

• A CMAI and 1Lattice study projects India's apparel market at $146.3 billion by 2029, up from $95.7 billion in 2025, which is roughly 9% annual growth. Demand is expected to be led by womenswear, kids-wear and casual-wear, with a continuing shift from unorganised to organised retail as brand consciousness rises.
• Rural India accounts for about $55.9 billion, or roughly 58%, of apparel consumption in the study. That makes the rural demand strain flagged in the monsoon story relevant for the sector's near-term trajectory, even as the longer-term projection depends on income growth and the pace of formalisation.

Markets and Assets

12. Nifty ends eight-week losing streak: Sensex hit a 32-month low on Thursday before Friday's rebound

• Nifty 50 closed at 22,520.45 on Friday, up 288.65 points (+1.30%) on the day and 0.44% for the week, ending its eight-week losing streak, the longest in 25 years. The Sensex rose 879.09 points (+1.23%) to 72,472.33. On Thursday the Sensex fell 1,045.46 points to 71,593.24, a 32-month low, and the Nifty fell 371.25 points to 22,231.80, its lowest close since April 2025, with an intraday 2026 low of 22,179.90.
• Thursday's fall came amid rising crude, the rate hike, higher global bond yields, rupee weakness and persistent foreign selling, with India VIX jumping 10% to 15.33 and BSE market capitalisation falling ₹11.15 trillion. Friday's rebound was led by IT stocks, with TCS among the top Nifty gainers, and VIX eased to roughly 14.4. A one-week gain ends the streak but does not by itself reverse the macro pressures behind it.

13. FPIs sell ₹44,166 crore (about $4.58 billion) of Indian equities in the first six sessions of October

• Foreign portfolio investors have net sold ₹44,166 crore of Indian equities so far in October, about $4.58 billion across the first six trading sessions, taking 2026 outflows to ₹3.04 lakh crore per NSDL data. On Thursday alone FIIs sold ₹12,943.58 crore while domestic institutions bought ₹10,703 crore. Reports indicate selling above $1 billion on three of the six sessions.
• Why it matters to you: Valuation concerns, higher crude and a weak rupee have driven the selling, and the India-US 10-year yield spread of about 194 basis points, near a 22-year low, leaves little yield incentive for debt inflows. Domestic institutional buying has absorbed part of the equity selling.

14. Rupee closes at ₹96.71 near its ₹96.965 record low: $143.5 billion of swap-window inflows against a $200 billion forward short

• The rupee closed at ₹96.71 on Friday, up 17 paise, after ending Thursday at ₹96.88. Its record low is ₹96.965, and analysts describe ₹97 as the level the RBI is expected to defend. The RBI's swap window has drawn $143.5 billion in total inflows as of September 18, of which FCNR(B) deposits account for about $133 billion.
• Against those inflows, the RBI's net short forward dollar position reached a record $200.06 billion at the end of August, up from $136.77 billion in July. About $176.6 billion of that matures beyond one year, and the net short within one year is about $23.5 billion after netting long positions, so the near-term delivery obligation is far smaller than the headline. Because much of the FCNR(B) money has to be repaid over three to five years, the RBI is likely to limit spot intervention, which keeps currency markets watchful.

15. Gold at ~$4,194/oz and silver at ~$60.70/oz rebound on Friday but stay well below January peaks

• Spot gold closed near $4,194 an ounce on Friday, up about 1.2% on the day, and silver rose about 2.8% to around $60.70. On the MCX, December gold traded near ₹1,51,300 per 10 grams and December silver near ₹2,24,859 per kilogram in the afternoon session. Silver was still about 11.7% lower over one month as of October 8, and both metals remain well below their January peaks.
• Wednesday's low in gold was its lowest since early August, and buyers stepped in after it. CME FedWatch shows roughly an 80% chance of a December US rate hike, which limits rebounds by raising the opportunity cost of holding gold, while central bank demand is modest and ETF demand has been weak. Both metals sit close to support levels, but buying interest remains limited.

16. India 10-year yield hits 7.31%, a three-year high: bank treasury profits may fall sharply

• The India 10-year government bond yield reached 7.31% on Friday, a three-year high, after closing at 7.19% on September 30 and 7.29% on Thursday. The move reflects the RBI's rate hike and tighter stance, higher US yields and expectations of further tightening. The India-US 10-year spread stood near 194 basis points on Thursday, close to a 22-year low.
• Analysts estimate that banks' investment-portfolio profits could fall to about ₹5,500 crore in the September 2026 quarter from ₹13,100 crore a year earlier, with public sector banks more exposed because of larger government securities holdings. Yields rose about 44 basis points over the quarter, which sets banks up for mark-to-market treasury losses that offset part of the gains booked in the first quarter. Q2 results will show how large the hit is.

17. Rate hikes and FCNR(B) flows: near-term pressure on bank margins, wider spreads if tightening continues

• FCNR(B) deposits carry higher interest and hedging costs, which may put marginal pressure on banks' net interest margins in the near term. The rate hike works the other way, as lending rates linked to the repo rate typically reprice faster than deposit costs.
• Some analysts expect cumulative tightening of around 50 basis points in 2026, which would widen spreads and could have a net positive effect on margins over time. Against that, treasury losses from higher yields (story 16) may weigh on reported profits in the near term, so Q2 and Q3 results will show which effect dominates.

Corporate and Regulatory

18. TCS Q2FY27: net profit ₹13,884 crore, revenue ₹73,188 crore, annualised AI revenue at $3.1 billion

• TCS reported Q2FY27 net profit of ₹13,884 crore, up 4.0% quarter-on-quarter from ₹13,349 crore, and revenue of ₹73,188 crore, up 1.3% sequentially and 11.2% year-on-year. Operating margin was 24%, voluntary attrition (trailing 12 months, IT services) was 13.3%, total contract value was $9.6 billion, and a second interim dividend of ₹12 per share was declared with a record date of October 14.
• Annualised AI revenue reached $3.1 billion, which is more than 10% of overall revenue. The results beat street estimates on revenue and earnings, and TCS was among the top Nifty gainers on Friday. The company also appears among the eight firms in the PERM suspension (story 3), a development that sits alongside the strong numbers.

19. Noel Tata seeks PMO meeting on Tata Sons listing as the Trusts-Tata Sons dispute escalates

• Noel Tata, chairman of Tata Trusts, has sought a meeting with the Prime Minister's Office to explain the Trusts' position on listing Tata Sons. In a five-page letter on October 6, he and three fellow trustees of the Sir Dorabji Tata Trust criticised vice-chairmen Venu Srinivasan and Vijay Singh for supporting a listing, and reiterated that the Trusts have consistently argued for Tata Sons staying private.
• Tata Trusts see listing as diluting their control over Tata Sons and restricting its philanthropy and business incubation role. Last month the Tata Sons board resolved to prepare for listing in line with the RBI's Upper Layer NBFC mandate, and the RBI filed a caveat in the Bombay High Court on Tata Sons' CIC registration. A request for PMO involvement suggests the dispute is moving beyond the boardroom into a policy conversation.

20. Jio Platforms IPO band reported at ₹1,065 to ₹1,119: an issue of about ₹30,000 crore would be India's largest

• Jio Platforms' IPO price band is reported at ₹1,065 to ₹1,119 per share, though neither the company nor SEBI has confirmed it. The issue is entirely fresh, sized at about ₹28,755 to ₹30,213 crore at an implied equity valuation of roughly ₹9.8 to ₹10.3 lakh crore. Reports put the anchor day at October 19, the opening at October 21 and listing at October 28.
• Earlier reports pegged the issue at roughly ₹37,000 crore and the valuation near ₹11 lakh crore, so the reported terms are lower on both counts. Even at the lower size, it would exceed Hyundai Motor India's ₹27,870 crore offer from 2024 and the NSE's ₹22,563 crore IPO from September. NSE shares were quoted around ₹1,731 on October 9 against the ₹1,785 issue price, a reminder that post-listing outcomes vary.

21. RBI conditionally approves Mizuho's $520 million Avendus acquisition; integration plan due within six months

• The RBI has given conditional approval for Mizuho's acquisition of a controlling stake in Avendus Capital for about $520 million, with Redpoint Investments, a KKR affiliate, and other shareholders as sellers. The CCI had cleared the transaction in April 2026, and the deal was first announced in December 2025.
• As a condition, Mizuho is required to submit an integration plan within six months explaining how it will consolidate its existing Indian NBFC holdings with the Avendus operations, so that its ownership structure in India is simplified. The conditions focus on structure rather than on the transaction itself, which suggests the regulator's priority is a clean ownership layout.

Watch Next Week

Disclaimer: This article is for general information and educational purposes only. It does not constitute investment advice, a recommendation, or an offer to buy or sell any securities or financial instruments. Market data, macroeconomic figures, and corporate announcements referenced in this article are based on publicly available sources and are subject to revision. Past market behaviour is not indicative of future outcomes. Please consult a SEBI-registered investment adviser or qualified financial professional before making any investment decision. Investments are subject to market risks. SEBI Registration No. INA000013518.