India Economics Weekly Renewed virus outbreak a key downside risk The rise in new COVID-19 infections to a three-month high this week does not appear to be a major threat to India's economy yet as cases are still comparatively low and the outbreak has predominantly... 19th March 2021 · 3 mins read
India Economics Weekly Markets are jumping the gun on RBI rate hikes Financial markets appear increasingly convinced that the RBI is on the cusp of monetary tightening, perhaps due to fears of a re-run of the Taper Tantrum in 2013. But India isn’t as vulnerable to a... 12th March 2021 · 6 mins read
India Economics Weekly Stage is set for a faster economic recovery India's economic recovery continues to proceed faster than we’d expected. We are revising our forecast for GDP growth this year to 13.5%, above consensus expectations of an 11% rise in output. With... 5th March 2021 · 5 mins read
India Economics Weekly Does the inflation target need an overhaul? The debate over the RBI's 4% headline inflation target - which runs until next month and is currently being reviewed - has heated up this week. Some prominent government officials have suggested that... 26th February 2021 · 5 mins read
India Economics Weekly Investment recovery, oil price impact The latest monthly activity data suggest that investment staged a stronger recovery than we had anticipated at the end of 2020 and, as such, we are nudging up our estimate of Q4 GDP. Meanwhile, the... 19th February 2021 · 4 mins read
India Economics Weekly Policymakers will keep a lid on borrowing costs Indian yields rose significantly in the aftermath of the unexpectedly-accommodative Union Budget announcement but developments since - including a ramping up of open market operations - have helped to... 11th February 2021 · 5 mins read
India Economics Weekly The benefits and limitations of a “bad bank” The creation of a “bad bank” in India - for which plans were briefly discussed in the Budget announcement - would help restructure the loans of the most heavily-indebted firms and facilitate a clean... 5th February 2021 · 5 mins read
India Economics Weekly Finance Ministry’s balancing act, RBI’s opportunity For India watchers, next week will be one of the most important of the year. We think the Finance Ministry will attempt to demonstrate prudence in the Union Budget on Monday, though obfuscation of the... 29th January 2021 · 5 mins read
India Economics Weekly FX reserve accumulation will limit rupee gains The RBI has accumulated foreign exchange reserves at a rapid pace over recent months, and comments this week from Governor Shaktikanta Das indicate that the central bank intends to build up its... 22nd January 2021 · 4 mins read
India Economics Weekly Investment recovering, but headwinds remain The latest monthly activity data suggest that investment growth recovered further in Q4. The rebound should continue over the coming months, but is likely to slow in the second half of the year as... 15th January 2021 · 3 mins read
India Economics Weekly Vaccine hopes and concerns The approval of COVID-19 vaccines in India this week were quicker than most had expected, but concerns over the approval process and pricing disagreements underscore some of the challenges that remain... 8th January 2021 · 5 mins read
India Economics Weekly A looser inflation target would not help The government is due to issue the RBI with a new inflation target next year, and there are suggestions that it is considering relaxing the existing framework perhaps by widening the “tolerance band”... 18th December 2020 · 6 mins read
India Economics Weekly Banks will get left behind in the recovery An emergency approval of a COVID-19 vaccine in India would reaffirm our view that the economic outlook has brightened. But while some have also turned more optimistic on banking sector prospects, we... 11th December 2020 · 5 mins read
India Economics Weekly Looser restrictions allow recovery to continue The recovery in GDP was a touch faster than expected in Q3, and activity data released this week point to a continued rebound in Q4. How much output continues to be made up over the coming months will... 4th December 2020 · 3 mins read
India Economics Weekly Surging portfolio inflows, Q3 GDP, RBI meeting Foreign portfolio inflows into Indian markets, particularly into equities, have surged in November and we think they will remain robust over the coming months. Looking ahead, we agree with market and... 27th November 2020 · 5 mins read
India Economics Weekly A dose of reality Newsflow continues to be dominated by the breakthroughs in the development of effective COVID-19 vaccines. But the collapse of Lakshmi Vilas Bank this week is another stark reminder of the extreme... 20th November 2020 · 4 mins read
