Renewed flare-up, fragile pause: the ceasefire that held through June broke down in early July after Iran struck vessels in the Strait of Hormuz; the US retaliated with strikes inside Iran, triggering roughly two weeks of near nightly exchanges. Brent crude spiked past $100/bbl for the first time since May and the rupee slid past
Rs.96.6/USD before a fragile pause emerged around July 25-26, Brent has since eased back to ~$85-86 and the
rupee has recovered to ~Rs.95.5-95.9/USD, though no formal ceasefire is yet in place.
Inflation breaches target, Q1FY27 earnings underway: CPI accelerated to 4.38% in June (from 3.93% in
May), reaching an 18-month high and the first breach of the RBI’s 4% target under the new series with food
inflation at 5.32%. The RBI’s next MPC meets August 3-5; the repo rate has held at 5.25% since February.
Q1FY27 earnings are broadly resilient so far and Nifty EPS for FY27 remains broadly tracked at Rs.1,050-1,080,
implying a Nifty target of 27,000-29,000.