India Economics Update RBI still taking baby steps towards tightening The MPC voted to keep policy rates on hold today, opting only to introduce further small measures to withdraw liquidity from the banking sector. With the RBI still focusing primarily on supporting the... 8th December 2021 · 3 mins read
India Economics Update Mobile payment takes off The pandemic has triggered a three-fold increase in the use of mobile payments in India. It is unclear whether there has been a corresponding broadening in the number of people using cashless payment... 11th November 2021 · 3 mins read
India Economics Update Annual fiscal deficit will be smaller than budgeted Relative to budget estimates, the cumulative fiscal deficit in rupee terms is much smaller than normal for this time of year, due in large part to decent tax revenues. We think the Finance Ministry... 1st November 2021 · 2 mins read
India Economics Update MPC fault lines emerge, but doves still in control The minutes of the Reserve Bank’s October policy meeting suggest greater divergence of opinion within the MPC, with two members calling for more definitive steps towards policy normalisation. But most... 25th October 2021 · 3 mins read
India Economics Update Burgeoning trade deficit is not a major concern The sharp widening in India’s goods trade deficit in September was driven in part by an unusually large jump in oil imports that we think will prove a one-off. And with the economic recovery entering... 15th October 2021 · 2 mins read
India Economics Update Rate hikes remain a distant prospect The Reserve Bank kept the repo rate on hold at a record low today and stressed that its latest liquidity-withdrawal measures do not constitute policy tightening. Given our view that the recovery will... 8th October 2021 · 3 mins read
India Economics Update Three points on banking sector liquidity Measures by the Reserve Bank to drain banking sector liquidity have caught attention over the past few days. But with liquidity still abundant, interbank rates at the very bottom of the rate corridor... 14th September 2021 · 2 mins read
India Economics Update Implications of a weak monsoon This year’s monsoon has so far been weaker than usual. This won’t have as big an economic impact as it would have a couple of decades ago. But it will harm employment and energy production. Some... 7th September 2021 · 3 mins read
India Economics Update Policy to stay loose despite first signs of MPC dissent The minutes of the Reserve Bank’s August policy meeting show the first signs of dissent as MPC member Jayanth Varma argued that a hike in the reverse repo rate and a change in policy stance would be... 23rd August 2021 · 3 mins read
India Economics Update Widening trade deficit no major concern The widening in India’s goods trade deficit in July was due in large part to the continued rebound in imports as containment measures were scaled back further. The trade deficit may widen a little... 16th August 2021 · 2 mins read
India Economics Update RBI in no rush to tighten policy The Reserve Bank kept the repo rate on hold at a record low today and announced plans to ramp up government bond purchases on the secondary market, underlining its commitment to supporting the... 6th August 2021 · 3 mins read
India Economics Update Asset sales delay will create a fiscal hole The postponement of the planned privatisation of two state-owned banks to next year has dealt an all-too-familiar blow to the Finance Ministry’s hopes of raising significant revenues from asset sales... 3rd August 2021 · 3 mins read
India Economics Update Wider trade deficit won’t threaten external position The widening in India’s goods trade deficit in June came on the back of a rebound in imports amid the lifting of containment measures and the recent rally in global oil prices. But while the economic... 16th July 2021 · 2 mins read
India Economics Update A closer look at India’s vaccine supply projections The government’s latest vaccine supply projections suggest that India could fully vaccinate all adults by year end. But that hinges on optimistic assumptions about production and distribution. Unless... 7th July 2021 · 3 mins read
India Economics Update How much further will inflation rise? The recent jump in India’s consumer price inflation has taken us (and most others) by surprise and we have revised up our near-term forecasts. However, a big chunk of the surge – even in the most... 22nd June 2021 · 4 mins read
India Economics Update External demand to support economy in Q2 India’s goods trade deficit narrowed to an eight-month low in May as exports held up much better than imports. Strong external demand will help to offset some of the damage to domestic demand caused... 16th June 2021 · 2 mins read
