Services & Composite PMI (Apr.)

The extraordinary plunge in the services PMI highlights that services is faring far worse than the manufacturing sector in the current crisis. Looking ahead, the services sector is likely to suffer for longer. After all, social distancing measures are only going to be relaxed in phases with factories more likely to reopen earlier than people-facing sectors such as hospitality and retail.
Darren Aw Asia Economist
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India Economics Weekly

Encouraging signs in state-level virus data

COVID infections have been falling in parts of India over the past week, particularly in those areas that were first to report Omicron waves. We’re hopeful that this is a sign of things to come, and wouldn’t be surprised if India’s third wave had largely subsided by the time the RBI next meets in early February.

21 January 2022

India Economic Outlook

On the cusp of policy tightening

India’s Omicron wave should only be a temporary setback to the economic recovery. As long as recurrent large waves of COVID are avoided, we think that economic growth will be faster this year than last. We also think that inflation will soon start to worry the RBI. Consequently, policy rates will be hiked by more than most anticipate.

19 January 2022

India Economics Weekly

Omicron surging, asset sales progressing

COVID-19 cases in India are still surging. But the early indications are that healthcare systems are not under significant pressure, and we’re hopeful that India’s third wave will peak before long. Even if it doesn’t, the better-than-expected fiscal performance over recent months means that there is policy space for the government to intervene.  

14 January 2022

More from Darren Aw

India Economics Update

Resilient remittances will aid the recovery

Remittance flows into India have been resilient in recent months and, with employment prospects for Indian migrants looking better than a year ago, they should continue to hold up well. That should provide some much-needed support for the economic recovery.

9 June 2021

India Economics Weekly

Lockdown extensions, industrial weakness

Several states have extended lockdowns this week even as new virus cases continue to plunge. With local governments taking a cautious approach to reopening, the economic recovery is likely to be more gradual than last year. However, this also reduces the threat of renewed outbreaks which could deal more severe blows to the economy.

4 June 2021

India Data Response

Services & Composite PMI (May)

India’s PMI readings for May adds to evidence elsewhere that the damage from the second virus wave has not been as severe as when the pandemic first struck last year. But with restrictions likely to be lifted slowly this time around, the recovery beyond the current outbreak looks set to be more gradual.

3 June 2021
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