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India's GDP growth expected to surpass initial forecasts, driven by government spendingReforms counter US tariffs, boost economic resiliencePrivate consumption and investment to show strong year-on-year growth, says stats ‌office India's ‌economic growth is estimated to ‍surge past most initial private and official forecasts, backed by robust domestic demand and government spending, ⁠helping New Delhi cope with ⁠punitive US tariffs. The near $4tn economy is expected to grow 7.4% in ‍the fiscal year ending in March, the National Statistics Office said on Wednesday, above the government's initial projection of 6.3%-6.8%. Indian Prime Minister Narendra Modi, facing steep US tariffs and an uncertain global backdrop, last year accelerated domestic reforms to support growth, including an overhaul of consumer taxes on hundreds of items and implementation of long-delayed labour reforms."(This growth) reflects that ‌despite rising global uncertainties India continued to perform well," Sakshi Gupta, economist at HDFC Bank, said.The estimate of gross domestic product, which will be revised over time as ‍data coverage improves, will ⁠be used as ‌a base for the federal budget due to be announced on February 1. The Indian economy grew 6.5% in 2024/25 and 9.2% in 2023/24.India has edged past Japan to become the world’s fourth-largest economy, the government said last month. Confirmation by the International Monetary Fund is due.In nominal terms, which factor in inflation, the economy is expected to grow 8%, compared with the 10.1% estimate in the annual federal budget announced last February.Private consumption, which accounts for about 60% of GDP, was seen expanding by 7% year-on-year compared to ​a 7.2% expansion last fiscal year.Government ‌spending is estimated to rise by 5.2% year-on-year in 2025/26, up from a 2.3% increase the previous year, ⁠while private investment is ‍seen rising by 7.8%, higher than the 7.1% growth the year before.The US has imposed 50% tariffs on some of India's key exports to punish it for its purchases of Russian oil.However, the strong growth estimate is possibly due to a limited hit on India’s exports so far, ​helping steady manufacturing growth, said Madhavi Arora, economist at Emkay Global.Manufacturing, which accounts for about 13% of GDP, is projected to expand 7% year-on-year in 2025/26, compared with 4.5% a year ago, while construction output was seen growing by 7%, down from 9.4% in the previous year, data showed.The output of farms, which employ more than 40% of India's workforce, was estimated to expand 3.1% in the current fiscal year from 4.6% a year ago. 

As the oil market moves closer to a long-anticipated glut, traders are closely watching buying from China to see if it will absorb an excess that the world’s crude producing nations are set to pump.Earlier this year, China piled into the crude market to snap up millions of barrels, including some that went into its strategic storage. The buildup has since slowed down as the nation’s domestic demand picked up, but with expectations that Beijing will continue to amass barrels, its next steps are seen as critical.With China’s vast network of oil tank farms still a little over 50% full, according to OilX data, traders say another spree would limit the damage from a long-anticipated glut in other parts of the globe. That’s significant because if China’s buying is elevated, it will prevent a buildup of supply in a narrow set of hubs in Midwestern America and Northwest Europe, limiting how far prices can fall.“The key question is where stockbuilds will turn up,” HSBC Holdings Plc analysts including Kim Fustier wrote this week. “If China continues to absorb excess oil volumes via its strategic reserves, as it did in in the second quarter, stockbuilds in the OECD could be muted.”The global market’s capacity to absorb barrels will be among talking points when OPEC+ nations meet to discuss supply on Sunday. Saudi Arabia wants the group to accelerate the return of another tranche of halted output adding to concerns about a surplus that would depress prices but all options are on the table.About 10% of the nation’s crude stockpiling has been directed to its strategic petroleum reserves, according to Kayrros analyst Antoine Halff. There have also been additions to the country’s refining capacity, such as CNOOC Ltd’s Daxie plant, and the addition of new tank space.It’s also possible that Beijing wants to hold more barrels in storage given the heightened levels of geopolitical risks over the last few years, the Oxford Institute for Energy Studies wrote in a note.While China’s flagship crude futures contract was flashing a softer market over recent weeks, the world’s two main benchmark’s continued to suggest relatively tight supplies.That’s because inventory builds so far this year have avoided western hubs. In Cushing, Oklahoma, the tank farm of about 15 storage terminals that underpins the West Texas Intermediate futures contract, inventories have been repeatedly near multi-year seasonal lows this year.The International Energy Agency says that in the second quarter global oil stockpiles increased by the most since the third three months of 2020, when the global economy was still being ravaged by the Covid-19 pandemic. Over that period, stockpiles in the developed world climbed by 60,000 barrels a day, while expanding by more than 1mn barrels a day everywhere else.It’s still possible that prices will need to fall from current levels for China buy in a big way, though, according to Frederic Lasserre, head of research at Gunvor Group.“The last solver that everybody is talking about is China,” he said. “Not for runs, but because we’ve seen a recent trend of them being willing to build up crude barrels. But if you expect China to go back to stockpiling 1mn barrels a day, you need a big price drop to incentivise it.”Both inside and outside of China there’s plenty of space to store unwanted oil.Bank of America Corp wrote last month that there’s about a billion barrels of empty tank capacity available across the globe to fill with inventories, which could mean that markets avoid falling into a heavily bearish structure.There are signs that the surge in production is starting to come, though. Brazil’s output approached 4mn barrels a day for the first time over the summer, and a new field is due to start in the country before the end of the year. Guyana has moved from producing nothing to almost 1mn barrels a day and output in Canada’s oil heartland of Alberta hit a record in July.At the same time, despite concerns about a decline in US output, the Energy Information Administration has consistently revised oil supply estimates higher over the last few months.What traders are waiting for now, is for those increases to appear at key storage hubs.“When we look at OECD inventories we’re still at a relatively low level,” Nadia Martin Wiggen, a director at Svelland Capital, said in a Bloomberg TV interview. “Yes, there is this supply glut coming according to expectations, but we need to see that materialising.”

Eurozone factory activity expanded for the first time since mid-2022 as domestic demand offset the impact from US tariffs while the Asian manufacturing sector saw shrinkage, private surveys showed Monday.There were mixed signals over the Chinese economy, however, as one such survey unexpectedly indicated modest expansion, contradicting an official readout the day before which showed activity continuing to shrink. Export powerhouses Japan, South Korea and Taiwan all saw manufacturing activity shrink in August, underscoring the challenge Asia faces in weathering the hit from sharply higher trade barriers erected by US President Donald Trump. In Europe, Greece and Spain led factory growth while manufacturing in Germany, the bloc's largest economy, shrank albeit at a slower pace.The HCOB Eurozone Manufacturing Purchasing Managers' Index (PMI) rose to an over-three-year high of 50.7 in August from 49.8 in July, surpassing the 50.0 threshold that separates growth from contraction."The recovery is real but remains fragile. Inventory levels continue to decline, and the slightly accelerated drop in order backlogs shows that companies are still suffering from uncertainty," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. "Domestic orders have risen and are offsetting the weakening demand from abroad. In fact, the best remedy against US tariffs may be to strengthen domestic demand."Meanwhile, manufacturing in Germany rose to a 38-month high of 49.8, a whisker away from the 50 mark, offering hope for the economy that shrank 0.3% last quarter on slowing demand from its top trading partner the US.The EU and the US struck a framework trade deal in late July but only the baseline tariff of 15% has so far been implemented. In Britain, outside the European Union, factory activity suffered a fresh setback in August after signs of a recovery due to worries about trade tensions and tax increases at home.The S&P Global Japan Manufacturing Purchasing Managers' Index (PMI) stood at 49.7 in August, improving from 48.9 in July but staying below the 50 threshold for two straight months.South Korea's factory activity also shrank with the S&P Global PMI standing at 48.3 in August, up from 48.0 in July but contracting for the seventh straight month.Both countries struck a trade deal with the US that eased, but not removed, the pressure on their export-reliant economies."It's a double-whammy for Asian economies, as they face higher US tariffs and competition from cheap Chinese exports," said Toru Nishihama, chief emerging market economist at Dai-ichi Life Research Institute. "We'll likely see the hit from US tariffs intensify going forward, with countries reliant on U.S.-bound shipments like Thailand and South Korea particularly vulnerable," he said.However, the RatingDog China General Manufacturing PMI, compiled by S&P Global, unexpectedly rose to 50.5 in August from 49.5 in July, exceeding the 50-mark that separates growth from contraction. The reading confounds an official survey on Sunday that showed activity shrank for a fifth straight month on weak domestic demand and uncertainty over the outcome of Beijing's trade deal with the USHalf-way through the month Trump extended his tariff truce with China for another 90 days, withholding imposition of three-digit duties until November 10.Meanwhile, India, which grew at a much better-than-expected 7.8% in the last quarter, continued to be a significant outlier in the region. Manufacturing activity in Asia's third-largest economy expanded at its fastest pace in more than 17 years in August.But the Trump administration's steep 50% tariff on US imports of Indian goods like garments, gems and jewellery threatens to dampen growth in the coming quarters.