A ceasefire that collapsed, a tariff that expired and was replaced, a monsoon running short, a World Bank vote of confidence and a brief return of foreign money. Five stories from July.
July was a month of reversals. A ceasefire ended, a tariff ended and restarted under another name, and foreign investors who had spent half a year selling Indian shares briefly turned buyers. Here are the five stories that mattered.
1. The ceasefire collapsed
After attacks on commercial ships in Hormuz, President Trump declared the Iran ceasefire over on July 8. Brent rose about 7% in a morning as the war premium returned, ending the brief calm that had followed June’s peace deal.
2. One tariff out, another in
The temporary US tariff under Section 122 expired on July 24. A new Section 301 tariff took effect the same day, with India placed in a 10% category, lower than first proposed.
3. A thin monsoon
The monsoon ran below normal through July as El Niño strengthened. Vegetable prices started to rise, and economists began raising their inflation forecasts for the second half of the year.
4. A vote of confidence
The World Bank projected India would grow 6.6% in 2026-27 and remain the fastest-growing major economy. In a year of war, oil shocks and tariffs, a projection like that is a reminder that India’s domestic engine remains strong, even if it is running slower than last year’s 7%-plus pace.
5. Foreign money came back, briefly
After months of heavy selling, foreign portfolio investors turned net buyers of Indian shares in July, helped by the tariff relief and a rotation into Indian software companies. Few expected it to last if oil rose again.
The thread: every piece of good news in July came with an asterisk.
July’s pattern was relief followed by a catch. The tariff fell, but under a new law. Growth stayed strong, but slower. Foreign money returned, but nervously. The RBI meets on August 5, and it will have to decide which half of each sentence to believe.
Sources: Reuters and AFP; USTR; India Meteorological Department; World Bank India Development Update; NSDL.
- The Iran ceasefire collapsed on July 8 and oil jumped about 7%.
- The US Section 122 tariff expired on July 24 and a 10% Section 301 tariff replaced it for India.
- The monsoon ran below normal, and food prices started to climb.
- The World Bank projected India to stay the fastest-growing major economy at 6.6%.
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