India Economics Update Inflation to ease again but RBI's targets under threat Inflation is likely to have fallen in March as food price pressures continued to ease. But further ahead, the RBI still faces a difficult task in meeting its inflation targets for 2017 and 2018. Given... 7th April 2016 · 1 min read
India Economics Update Will commercial banks now pass on policy rate cuts? Having now cut its repo rate by 150bp since January 2015, the RBI yesterday re-emphasised the need for commercial banks to boost lending by passing on rate reductions to borrowers. In truth, high... 6th April 2016 · 1 min read
India Economics Update RBI cuts repo rate but loosening cycle now at an end The Reserve Bank of India (RBI) reduced its repo rate by 25bp to 6.50% today but, given the difficulties it faces in meeting its inflation targets for March 2017 and 2018, we think that rates will now... 5th April 2016 · 1 min read
India Economics Update State elections take centre stage The raft of upcoming state elections in India are likely to have an important bearing on economic policy at the local level. But perhaps more significant, the outcome of the state elections could be... 31st March 2016 · 1 min read
India Economics Update External position continues to strengthen The narrowing in India's current account deficit in Q4 2015, along with the pick-up in foreign direct investment inflows, supports our view that the country's external position will remain far less a... 22nd March 2016 · 1 min read
India Economics Update Markets regain their poise India's financial markets have rallied over the past couple of weeks following a terrible start to the year. The rupee has strengthened, while local equities have made significant gains. Meanwhile... 21st March 2016 · 1 min read
India Economics Update Investment activity showing tentative signs of improvement The government’s plans to boost capital expenditure should help sustain the recent tentative pick-up in investment activity. But slow movement on the reform front means that a spectacular rebound is... 18th March 2016 · 1 min read
India Economics Update Lower import bill to keep trade deficit in check India’s monthly trade deficit narrowed in February to its smallest since September 2013. With a number of factors likely to keep commodity imports in check, the overall current account position is... 16th March 2016 · 1 min read
India Economics Update Outlook for remittances remains upbeat The recent market turbulence cast a spotlight on the potential for shifts in capital flows to destabilise emerging markets such as India. One factor that often gets overlooked is the role of overseas... 10th March 2016 · 1 min read
India Economics Update Inflation to edge down but scope for loosening limited Inflation is likely to have edged down in February as food price pressures have shown signs of abating. The chances of there being perhaps one more rate cut in the near term have risen, but this is... 8th March 2016 · 1 min read
India Economics Update Finance ministry’s revenue assumptions look too optimistic Finance Minister Arun Jaitley’s budget on Monday was well received, with targets for further reductions in the deficit left unchanged and projected spending in key areas ramped up. But the plans are... 2nd March 2016 · 1 min read
India Economics Update FY16/17 budget: finance ministry stays on consolidation path At first glance, Finance Minister Arun Jaitley appears to have pulled off a difficult balancing act in today’s nbudget announcement. The tighter deficit targets have been left unchanged, while the... 29th February 2016 · 1 min read
India Economics Update Land laws to remain an economic constraint With markets and commentators focused on what will be unveiled in the FY16/17 budget on Monday, prospects for the rest of the current session of parliament have slipped under the radar. One of the... 26th February 2016 · 1 min read
India Economics Update Policymakers unfazed by rupee slide The Indian rupee has depreciated against the US dollar so far in 2016 to its weakest level since the 2013 "taper tantrum". But unlike three years ago, there is little reason for policymakers to panic. 22nd February 2016 · 1 min read
India Economics Update What measures are needed to revive the banking sector? Comments last week from RBI Governor Raghuram Rajan that local banks are in need of "deep surgery" has refocused attention on the ailing sector. Large-scale capital injections, increased private... 17th February 2016 · 1 min read
India Economics Update Trade deficit to remain in check despite weak export prospects India’s trade deficit narrowed at the start of 2016 as the continued slump in exports was more than offset by another collapse in imports. With a number of factors likely to keep commodity imports in... 16th February 2016 · 1 min read
