Mixed earnings and not so encouraging macroeconomic data dented sentiment, Ajit Mishra, VP - Research, Religare Broking Ltd said. In twin blows to Indian economic revival, higher food prices drove retail inflation to a five-month high of 7.4 per cent, while factory output fell for the first time in 18 months. The second consecutive month of rise in consumer price index (CPI)-based inflation will add to the pressure on the Reserve Bank of India (RBI) to again raise interest rates to tame high prices. In the broader market, BSE Midcap declined 0.73 per cent while smallcap dropped 0.45 per cent.
FMCG: Cut in excise duty on baby, clinical diapers, adult diapers and sanitary napkins.
Retail inflation declined to an 18-month low of 4.7 per cent in April mainly due to falling prices of vegetables, oils and fats, and came closer to Reserve Bank's target of 4 per cent, showed government data released Friday. It was for the second month in a row that Consumer Price Index (CPI) based inflation remained within the RBI's comfort zone of below 6 per cent. The government has tasked the central bank to ensure retail inflation remains at 4 per cent with a margin of 2 per cent on either side.
The rate of price rise for consumer foods eased to 4.7 per cent in January, from 4.96 per cent in December.
The Consumer Price Index-based inflation rose to 5.11% in January
Congress spokesperson Abhishek Manu Singhvi cited a viral video on social media platforms, claiming that in it Modi's voice is heard in a call with BJP rebel Kripal Parmar.
With fuel being the main input cost for the transport sector, rise in cost of operations is a given. The sector is unsure on the extent of being able to pass this on through rentals or to absorb it with higher volumes.
The policy review observed that the moderation in inflation, excluding food and fuel, that was witnessed in the first quarter of 2017-18 has "by and large, reversed".
Dairy, sugar prices fall sharply, despite El Nio fears
The Bharatiya Janata Party notes with dismay the fact that the consumer price inflation in India today is the highest among all the countries of Asia-Pacific.
Overall retail inflation in rural and urban areas stood at 7.38 per cent and 8.25 per cent in January, respectively.
RBI will be considering this set of data for formulating its next bi-monthly monetary policy on October 5.
There could possibly be some reduction in home/auto loan outgo.
After consumer price index jumped the 6.3-per cent mark in May and wholesale inflation set a record of 12.94 per cent, house economists at Swiss brokerage UBS Securities have warned that the country is facing more upside risks on the inflation front that is set to averaging at 5 per cent for the year. Rising prices of edible oils and protein rich items pushed retail inflation to a six-month high of 6.3 per cent in May, breaching the comfort level of the Reserve Bank and thus rendering reduction in interest rates a difficult proposition in the near term. Led by petrol price, that has crossed the Rs 100-mark in many states, wholesale inflation too accelerated to a record 12.94 per cent in May. While crude oil has crossed $70 a barrel on account of rising prices of crude oil and manufactured goods due to spike in commodities, and the low base of last year due to the lockdown.
Retail inflation remained above the RBI's comfort level for the second consecutive month despite slipping slightly to 6.26 per cent in June while the factory output recorded a growth of 29.3 per cent in May, mainly on account of the base effect, the government data showed. The marginal slippage in the Consumer Price Index (CPI)-based inflation was noticed despite little firmness witnessed in the food inflation which inched up to 5.15 per cent in June from 5.01 per cent a month ago. Retail inflation based on Consumer Price Index (CPI) was 6.3 per cent in May 2021 and 6.23 per cent in June 2020.
Polarisation and the increase in index weight of a few a stocks have weighed on performance. The worst performers include Nippon India Large Cap and HDFC Top 100 (2.6 per cent).
To curb soaring inflation, the People's Bank of China, the country's central bank, has raised the benchmark interest rate three times this year.
The pace of retail price rise in January 2016 is the highest since 6.46 per cent in September 2014.
Rupee, however, added some respite after strengthening for the first time today during the last five trading sessions.
NTPC, Hero MotoCorp and Reliance Industries down 2% each among the top losers
According to the Central Statistics Office data, the jump in the retail inflation based on Consumer Price Index was mainly due to rise in prices of kitchen items like vegetables, meat and fish.
From the Sensex pack, Adani Ports & Special Economic Zones, Mahindra & Mahindra, Reliance Industries, HDFC Bank, Larsen & Toubro, NTPC, State Bank of India, UltraTech Cement and Kotak Mahindra Bank were the major gainers. In contrast, Tata Steel, Titan, Bajaj Finserv, JSW Steel, Bajaj Finance, Hindustan Unilever, ITC, Tata Motors and Tata Consultancy Services were among the laggards.
In a bid to widen the ambit of beneficiaries getting reservation under the Other Backward Classes quota, the central government on Thursday enhanced the ceiling for applying the 'creamy layer' restriction on "socially advanced persons". While the income criterion so far was Rs 4.5 lakh per annum, the Union Cabinet on Thursday increased it to Rs 6 lakh per annum.
While India won't be immune to global spillovers, we need to create the macro preconditions for sustained growth. Policy agility, prudence, and resilience will be key, suggests Sonal Varma.
Raghuram Rajan said on Friday it is not clear India needs a so-called "bad bank.
In spite of Governor Raghuram Rajan's repeated concerns about inflation, many think there may still be a loosening of stance.
The government had amended the RBI Act through Finance Act 2016.
The size of Reserve Bank's balance sheet increased by 11.08 per cent to Rs 70.47 lakh crore as on March 2024, leading to the highest-ever dividend payout to the government, according to the central bank's annual report. In actual terms, the increase was Rs 7,02,946.97 crore over Rs 63.45 lakh crore as on March 2023.
Recommends delisting of chana futures, open to lowering sugar import duty
The Reserve Bank of India Governor Shaktikanta Das on Monday said that the "momentum of inflation is on a downward slope" and the central bank would continue to strike a delicate balance between the need to contain price rise and ensure economic growth. The Reserve Bank's inflation projections, Das said, are "robust" but contingent on downside and upside risks associated with the movement of global crude oil prices. The RBI takes into account a particular range within which crude prices are expected to fluctuate considering all the factors that can be anticipated and that can be sort of foreseen as of today, he said.
Food prices are also expected to move up due to the poor monsoons.
The Ministry of Statistics and Programme Implementation (MOSPI) is in talks with the Department of Posts to take the help of its staff in collecting sample data for the proposed Consumer Price Index for Rural India (CPI-R). The data for the index would be collected from 1,000 villages, Chief Statistician of India Pronab Sen said on the sidelines of a national seminar on the results of the 61st round of the National Sample Survey.
Trumponomics, poor growth, and high valuation certainly don't make a bullish recipe for Indian markets, warns Debashis Basu.
6 per cent increase in DA for Central govt employees
Stocks of Indian steel companies are reeling from pricing pressure that is partly blamed on cheap imports. The stocks have declined up to 9 per cent on the NSE in one month, likely allowing investors an opportunity to use the correction to enter the pack as pricing pressure eases. "In steel or any other commodity, if prices or spreads are nearing their bottom, it can be an opportune time to invest in those stocks. In India, domestic fundamentals such as steel consumption remain robust, hence one can take fresh positions in these counters," said Amit Dixit, an analyst at ICICI Securities.
China's inflation rate rose to 8.5 per cent in April, bouncing back to hover near 12-year highs, bringing more pressure on government to tame rising prices, identified by it as the "biggest concern".The Consumer Price Index (CPI), main gauge of inflation, rose 8.5 per cent from 8.3 per cent in March and remained close to a nearly 12-year monthly high of 8.7 per cent recorded in February, the National Bureau of Statistics said.
They have also called for giving cash to the poor, so that demand is generated in the economy.
The Monetary Policy Committee (MPC) is expected to maintain the status quo on policy rates for the fourth consecutive time in its October 4-6 review meeting. The incremental information available since its last meeting in August suggests that growth and inflation prints for the second quarter (Q2) of financial year 2023-24 (FY24) will exceed the committee's projections. However, the Consumer Price Index (CPI)-based inflation is expected to moderate in the second half (H2) of FY24.
Indian equity markets should be able to withstand inflation up to 8 per cent, said analysts at Credit Suisse Wealth Management in a recent note. Should the rate of inflation move higher than this, the valuation of Indian equities could deteriorate further, they cautioned. The fall from the peak levels has seen Nifty's 12-month forward price-to-earnings (P/E) ratio of 17.6 dip toward its 10-year and 5-year (pre-COVID) average of 16.9, which suggests that valuation froth of Indian equities has settled, said the Credit Suisse analysts.
Indian passenger vehicles market registered record wholesales of 43 lakh units in 2024, with companies like market leader Maruti Suzuki, Hyundai, Tata Motors, Toyota Kirloskar Motor, and Kia posting their best-ever annual domestic sales. The continued growth of SUVs, along with rural markets playing a key role in driving up car sales, helped the industry better the previous best of nearly 41.1 lakh units posted in 2023.
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