Filtered by Subscriptions: India Economics Use setting India Economics
The merchandise trade deficit narrowed in July and we think that it will remain small over the coming months given India’s limited exposure to trade tensions between the US and China and the fact that oil prices are likely to stay around their current low …
15th August 2019
Headline inflation is likely to have remained below the RBI’s 4.0% target in July and will be used by the central bank as vindication of its decision to reduce interest rates for the fourth consecutive meeting yesterday. But with policy now being loosened …
8th August 2019
The Reserve Bank delivered a (slightly) larger-than-expected rate cut today and has left the door open for further easing. If soft surveys are correct in suggesting that there is limited slack in the economy, further policy loosening could lead to higher …
7th August 2019
Investment growth collapsed to a near four-year low in Q1. While a spectacular rebound will remain elusive, investment should recover gradually over the coming quarters as election-related uncertainty clears and funding costs drop following the RBI’s cuts …
5th August 2019
Gold prices have hit a record high in rupee terms in recent weeks, surpassing the previous peak in 2012 when India was on the brink of a balance of payments crisis. But a drop in underlying demand for gold, and lower prices for other major imports, …
30th July 2019
Measures announced during this month’s union budget to ease restrictions on foreign direct investment into India should help to assuage concerns that policymakers have taken a more insular view on investment policy. Our view remains that the Modi …
24th July 2019
The government’s hopes of hitting the record asset sales target that has been set in the budget for FY19/20 appear to be dependent on the smooth sale of a large stake in Air India. That seems unlikely. The government may choose to deploy some creative …
17th July 2019
India’s merchandise trade deficit narrowed for the first time in five months in June. Looking ahead, a limited exposure to a more protectionist US, as well as low oil prices, will help to keep the trade deficit contained over the coming months. Data …
16th July 2019
The likely rise in headline inflation in June won’t prevent the MPC – now firmly under the control of doves following the surprise resignation of deputy governor Viral Acharya last month – from cutting rates further over the coming months. However, …
8th July 2019
The finance ministry attempted to demonstrate its commitment to fiscal prudence by lowering the FY19/20 deficit target in today’s union budget announcement. However, it is also aiming to boost economic growth with proposals to support SMEs and bolster the …
5th July 2019
India’s current account deficit narrowed in Q1 and, while significant policy loosening could cause imports to pick up over the coming quarters, we think that oil prices will remain low. This should keep the import bill in check. Meanwhile, FDI inflows …
1st July 2019
Given the recent economic slowdown, new Finance Minister Nirmala Sitharaman is likely to announce more accommodative tax and spending measures when she unveils the union budget for this fiscal year on 5 th July. Ms Sitharaman may choose to paper over the …
27th June 2019
The surprise resignation of RBI deputy governor Viral Acharya – one of the most hawkish members of the MPC – boosts the chances of further rate cuts in the near term. But it should once again raise questions over the RBI’s credibility and its …
25th June 2019
The finance ministry made a clear bid in the interim budget today to shore up popular support ahead of the general election with proposals to boost rural incomes and cut income tax. But it is also hoping to demonstrate its commitment to fiscal prudence by …
1st February 2019
The finance ministry will be keen to include some election sweeteners in the interim budget that is due on 1st February. But it will also want to demonstrate fiscal rectitude. The most likely outcome is that the deficit target for FY18/19 is revised up …
24th January 2019