It is unlikely that the RBI will drop rates until the inflation rate drops below five per cent.
'Yet the market didn't do all that badly because it was cushioned by domestic inflows.'
Inflation rate during August, the data for which is yet to be released, was likely to remain at about 7 per cent, said SBI Ecowrap.
India's manufacturing sector growth climbed to a 16-year high in March on the back of the strongest increase in output and new orders since October 2020, amid reports of buoyant demand conditions, a monthly survey said on Tuesday. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) surged to a 16-year high of 59.1 in March, from 56.9 in February, reflecting stronger growth of new orders, output and input stocks as well as renewed job creation. In Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion while a score below 50 denotes contraction.
'The actual price of petrol is Rs 35 and it jumps to Rs 88 because of government taxes.'
Vegetables and fruits have weights of 1.74 per cent and 2.11 per cent, respectively, in the wholesale price index.
The government hopes of registering GDP growth rate ranging between 6.1-6.7 per cent in 2013-14.
While FMCG companies lose Rs 98,928 crore in m-cap, consumer durables stocks are down Rs 20,673 crore since November 8.
The current situation offers an opportunity for farmers to reinvest in agriculture.
The wholesale price-based inflation rose for the second consecutive month in February to 4.17 per cent, as food, fuel and power prices spiked. The WPI inflation was 2.03 per cent in January and 2.26 per cent in February last year. After witnessing months of softening of prices, the food articles in February saw 1.36 per cent inflation. In January it was (-) 2.80 per cent.
The inflation in the food basket spiked to 7.89 per cent in October 2019 as against 5.11 per cent the preceding month.
The employment situation remains dire. Whatever can be done to promote greater low-skill employment should be pursued aggressively, advises former chief economic adviser Shankar Acharya.
Among top losers that dragged down key indices were Infosys, TCS, Reliance, SBI, Tata Steel and ITC, falling up to 2.15 per cent.
To cut interest rates, the central bank head has to open up a debate on inflation target revision.
Also says PSU banks divestment to be considered after improvement in governance
The stock of consumer goods major Emami has corrected nearly 3.5 per cent since its 52-week high of Rs 546.25. On August 29, the stock closed at Rs 521.90 on the BSE. After underperforming the Nifty FMCG index for a long time, the stock is now doing a catch up and surged over 13 per cent in the past one month.
Lead indicators suggest that domestic current account deficit (CAD) is likely to reduce in 2023, while macro-economic stability has received a boost from inflation being brought back to the official tolerance band, according to the Reserve Bank of India's (RBI's) January 2023 Bulletin. "With the merchandise trade deficit reaching an all-time high of $83.5 billion in a quarter, and a rise in net outgo from the income account, the current account deficit increased to 4.4 per cent of GDP in Q2FY23," the State of the Economy article in the bulletin said. "It is noteworthy, however, that the CAD for Q1 was revised down from 2.8 per cent to 2.2 per cent on account of downward adjustment in Customs data.
Investors will keenly watch US Fed meet starting Tuesday
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The Indian rupee touched record low of 65.52/dollar on Thursday and is down 16 per cent so far this year despite efforts by policymakers to prop it up.
Finance Minister Nirmala Sitharaman on Thursday said inflation management cannot be "singularly" left to the monetary policy as a majority of activities are outside its purview in the current context. Speaking at a seminar organised by economic think-tank Icrier, the finance minister said that both the fiscal policy and the monetary policy have to work together to contain inflation. Consumer price index (CPI) based inflation or retail inflation is ruling above the Reserve Bank's comfort level of 6 per cent since January.
Retail inflation rises to 4.41% in Sep on dearer food items
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As on Monday, the prices of many vegetables had fallen as much as 50% compared with those a month before, due to increased supply, following the arrival of winter crops in the markets.
The US Fed's rate cycle is set to turn later this year, but India is in a much better position than it was in 2013.
RBI targets to keep inflation at 4 per cent, (+/- 2 per cent), and its rise beyond this comfort zone will put pressure on the central bank to hike rates.
The forecast of deficient monsoon rainfalls scared farmers.
Data suggests that households too are expecting inflation to subside, with the three-month-ahead and the one-year-ahead expectations declining by 40 basis points, reports Abhishek Waghmare.
Fruits, vegetables and eggs continued to witness deflationary trend during January this year, with their prices declining 4.18 per cent, 13.32 per cent and 2.44 per cent, respectively.
The most consistent wealth creators since 2008 are all consumer-facing companies, says Devangshu Datta.
Government's push for Make in India which focuses on select 26 sectors and improving the 'ease of doing business' will aid the manufacturing/industrial growth.
Besides high portfolio yield, investors may enjoy capital gains in debt funds in 2023 as bonds rally in anticipation of rate cuts.
If the pattern over the last three months is going to continue, the likelihood is that both indices will register inflation rates close to current levels over the next few months.
Over the past year, the National Stock Exchange Nifty FMCG Index, which tracks the market capitalisation of the top 15 companies in the fast-moving consumer goods (FMCG) sector, has surged by 17.3 per cent. In contrast, the Nifty50, a broader market index, has witnessed an 8.8 per cent increase during the same period. The FMCG stocks have also been rally leaders in the current calendar year.
US consumer confidence tumbled to a five-year low in March, disappointing economists and raising fears that the American economy could be heading into a deep recession. The Conference Board's confidence index fell from 76.4 in February 64.5 this month, compared with economists' expectations of a much lighter drop to about 74, as US consumers fretted over the deteriorating labour market and higher food and energy prices.
After a delayed start, the monsoon is advancing steadily.
The change from wholesale to retail inflation as an anchor means that the weightage of diesel in inflation has decreased
Lower fuel subsidy payouts might restrict gross fiscal deficit in FY15.
Economy to grow 6.5% in 2016 on better macro conditions, says Mckinsey.
Elections may be a few months away, but the government may get into election mode much earlier than that, predicts A K Bhattacharya.
The Nielsen survey was conducted online and covered more than 30,000 consumers across 60 markets.
State-owned Indian Oil Corporation (IOC), Adani-Total Gas Ltd and Shell were among the 29 companies that bid and bought natural gas to be produced from the deepest field in the KG-D6 block of Reliance Industries Ltd and bp, sources said. IOC walked away with almost half of the 6 million standard cubic meters per day of gas sold in an e-auction on Wednesday while state-owned gas utility GAIL bought 0.7 mmscmd, Adani-Total Gas Ltd 0.4 mmscmd, Shell 0.5 mmscmd, GSPC 0.25 mmscmd and IGS another 0.5 mmscmd, two sources with knowledge of the matter said. Reliance-bp on Wednesday held an e-auction for sale of gas from the MJ field in their eastern offshore KG-D6 block after incorporating the government's new marketing rules to give CNG-selling city gas companies first priority over supplies.
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