Indian economy is in a sweet spot, with a mix of solid growth and moderating inflation, Moody's Ratings said, forecasting a 7.2 per cent GDP growth in the 2024 calendar year and 6.6 per cent in the next. In its Global Macro Outlook 2025-26, the rating agency said the global economy has shown remarkable resilience in bouncing back from supply chain disruptions during the pandemic, an energy and food crisis after the Russia-Ukraine war began, high inflation and consequent monetary policy tightening.
However, it may still not change its stance on the policy rate as inflationary pressures are coming from high commodity prices.
In the Upper House of Parliament, Chairman M Venkaiah Naidu did not allow adjournment notices moved by opposition members on the issue of price rise, prompting members of the Congress, the Trinamool Congress, the Left parties, the Dravida Munnetra Kazhagam, the Aam Aadmi Party, the Nationalist Congress Party, the Rashtriya Janata Dal and the Shiv Sena to create an uproar.
The finance ministry expects a broad-based moderation in inflationary pressures on the back of an anticipated reduction in food prices as a result of the uptick in summer sowing. The retail inflation rate remained stubbornly clung to the 5 per cent mark in seven of the past eight months. "Core inflation is trending downwards, indicating a broad-based moderation in price pressures... Driven by strong domestic growth and benign global commodity prices, core inflation is declining continuously.
Marico may buck the industry trend with the fast-moving consumer goods (FMCG) major reporting strong growth and favourable commentary in a weak quarter for the industry. The company reported consolidated revenue growth of 8 per cent year-on-year (Y-o-Y) in Q2FY25. Domestic revenue growth was 8 per cent Y-o-Y with 5 per cent volume growth (4 per cent in Q1FY25).
More than 25 crore workers engaged in sectors ranging from banking, insurance, postal to coal mining, highway and construction are expected to go on a nationwide general strike on Wednesday, potentially disrupting services across the country. A forum of 10 central trade unions and their associates has called for a general strike or 'Bharat Bandh' to "oppose the anti-worker, anti-farmer and anti-national pro-corporate policies of the government".
The Opposition members said that despite adequate availability of essential commodities, inflation was still high and government has failed to check the price line. Initiating a debate in the Lok Sabha on rise in prices of essential commodities, Rajiv Ranjan Singh Lalan (Janata Dal-United) said 85 crore (850 million) people in India were below the poverty line and despite this the government was not interested in checking inflation.
Finance Minister Nirmala Sitharaman on Friday flagged concerns about possible cartelisation in markets and stressed on the need to look into the causes of short supply of commodities. Speaking at the 13th annual day function of the Competition Commission of India (CCI), the minister also said that the regulator needs to have a "proactive understanding" of mergers and acquisitions. "Cartelisation is going to be a challenge...," the minister said.
From the Sensex constituents, Tata Steel, Bajaj Finance, Bharti Airtel, Adani Ports, Eternal, Bajaj Finserv, NTPC, HDFC Bank, Reliance Industries and Axis Bank were among the major gainers. In contrast, Trent, State Bank of India, Tech Mahindra, Maruti and Mahindra & Mahindra were among the laggards.
The continuing global uncertainity has complicated the fight against inflation, opined Reserve Bank Deputy Governor Michael Debabrata Patra during the Monetary Policy Committee meeting held on February 8. According to the minutes of the MPC meeting released on Wednesday, RBI Governor Shaktikanta Das also mentioned that there is considerable uncertainty due to a host of global factors such as rising non-oil commodity prices. The RBI on February 8 hiked the key short-term lending rate by 25 basis points to 6.5 per cent, citing sticky core inflation.
Prices of almost all industrial commodities, barring cotton, are likely to cool down in 2008, after handsome gains in 2007, when a supply glut is expected to supersede demand.
Over 25 crore workers across India are set to strike against new labour codes and privatisation, potentially disrupting banking, postal, and other essential services.
India is among the three least-favoured Asian stock markets, according to BofA Securities whose survey found that 10 per cent of fund managers are underweight on Indian equities from a 12-month perspective.
The Reserve Bank of India, in its monetary policy for 2011-12 released earlier this month, had said that international commodity prices are a major area of concern.
Cascading effect of rising raw materials will result in inflation, high rates, slow capex
Jeera July futures in NCDEX touched a record high of Rs. 58,085 per quintal on Monday, before coming down to around Rs. 55,500 on Tuesday. This was due to profit booking and extension of additional surveillance margin of 2.5 per cent till July 18, including on all contracts to be launched in the future. The softening, according to some reports, is also because of fears of regulatory action on jeera traders over allegations of excessive speculation.
Retail inflation in August inched up to 3.65 per cent, though vegetables and pulses witnessed price rise in double digits, according to official data released on Thursday. The retail inflation based on the Consumer Price Index (CPI), however, remained below the Reserve Bank's median target of 4 per cent for the second month in a row. It was at a five-year low of 3.6 per cent in July.
Fast food chain McDonald's is planning to diversify into the economy segment as it seeks to find a way out of the rising commodity prices.
Brokerages expect a further slowdown in Indian firms' revenue and earnings growth in Q4FY25, following low single-digit growth in the preceding three quarters, as factors like weak consumer demand and credit growth linger on.
Wholesale inflation fell to a 4-month low of 1.31 per cent in August due to a decline in prices of vegetables and fuel, even though onion and potato prices spiked, according to official data released on Tuesday. Wholesale price index-based inflation fell for the second straight month in August after it hit a high of 3.43 per cent in May. Inflation in July was 2.04 per cent. In August last year, WPI inflation was (-) 0.46 per cent.
S&P Global Ratings on Tuesday cut India's GDP growth projections to 6.5 per cent for the next fiscal as it expects that economies in the APAC region will feel the strain of rising US tariffs and pushback on globalisation. In its Economic Outlook for Asia-Pacific (APAC), S&P said despite these external strains, it expects domestic demand momentum to remain solid in most emerging-market economies.
Gold has always served as a hedge against inflation and declining US dollar. When investors realise that their money is losing value they will start positioning their investments in a hard asset that has traditionally maintained its value. The reason gold benefits from a declining US dollar is because gold is priced in US dollars globally. Whenever there is news that hints at some type of uncertainty, investors will often buy gold as a safe haven & as diversifying investment.
'Macro headwinds are rising for Indian equities in the form of rising commodity prices, especially oil, depreciating rupee, fiscal challenges, election-related uncertainty and upside risks to inflation'
IMD expects day temperatures to remain above-normal in select regions across the country between March and May 2021.
India's exports are unlikely to get an immediate boost from a depreciating rupee, which touched an all-time low on Monday, driven by rising commodity prices. The rupee fell to 76.97 against the dollar earlier in the day, settling 1.05 per cent weaker than the previous close. Oil prices soared to their highest since 2008 on Monday at $139 per barrel, after the US and European allies explored a Russian oil import ban, while delays in the potential return of Iranian crude oil to global markets increased supply fears.
Home appliance maker Crompton Greaves Consumer Electricals reported better than expected performance in the second quarter (Q2) of 2024-25 (FY25), outperforming peers due to a strong showing in the electrical consumer durables (ECD) segment. The company's standalone sales rose by 10.5 per cent, while the ECD segment continued its growth momentum with a 12.5 per cent increase in revenues, driven by volume and pricing gains.
Ahead of its annual credit policy, the RBI also said the government's inability to raise oil prices in line with increase in the international prices poses a 'significant medium-term risk' to the economy.
How has the NDA government fared in tackling price rise, an issue it raised hell over in the run-up to the Lok Sabha elections? The Rediff Labs team finds out.
The January-March quarter (Q4) results for 2024-25 (FY25) from the country's largest passenger vehicle (PV) maker, Maruti Suzuki India (MSIL), were a mixed bag, with revenues broadly in line but operating profit missing Street expectations. Given cost pressures, margins at the operating level were the lowest in the past seven quarters.
Gold prices slumped for the second straight session by Rs 1,150 to Rs 78,350 per 10 grams in the national capital on Monday on frantic selling by stockists and retailers, the All India Sarafa Association said. The precious metal of 99.9 per cent purity closed at Rs 79,500 per 10 grams on Friday.
Moderation in the economy in the short-term could be because of high inflation, rising commodity prices, high oil prices, increasing fiscal deficits and global uncertainties, Edelweiss said in its annual report. Despite the BSE Sensex swinging between 12,500 in March 2007 and 21,000 in March 2008, fund mobilisation through the primary and secondary markets is preferred, it said.
'There is a lot of interest from potential clients who have remained away from the markets in past years.' 'They are evaluating whether this is a good time to enter, especially since there are very few alternatives to earn meaningful returns.'
Petrol price on Sunday was hiked by 50 paise a litre and diesel by 55 paise, taking the total increase in rates since resumption of daily price revision less than a week back to Rs 3.70-3.75 per litre. Petrol in Delhi will now cost Rs 99.11 per litre as against Rs 98.61 previously while diesel rates have gone up from Rs 89.87 per litre to Rs 90.42, according to a price notification of state fuel retailers. Rates have been increased across the country and vary from state to state depending upon the incidence of local taxation.
Commodity investments can help you diversify your portfolio in asset classes other than equity and debt, says Dwaipayan Bose.
The value of foreign portfolio investment (FPI) in Indian equities was at $542 billion in the March quarter of 2023, a decline of 11 per cent from the preceding year, largely due to the exodus of foreign money from the domestic market, according to a Morningstar report. In comparison, the value of FPI in Indian equities was $612 billion in the January-March quarter of 2022. On a quarter-on-quarter basis, the value of FPI in Indian equities fell by 7 per cent from $584 billion recorded in the three months ended December 2022.
With each passing day, the dollar keeps sinking lower against both the euro and the Japanese yen. In the process, prices of individual assets get carried way beyond the levels justified by economic fundamentals. Prices of 'risky', that is non-sovereign, bonds have also been falling rapidly. Confidence in dollar markets has sunk very low, and is getting reflected in the prices of currencies and bonds. The US treasury has still not changed its 'strong dollar' policy.
Paul Romer, a New York University professor and economist
'Investors' decisions should reflect their financial goals, risk tolerance, and the amount of gold already present in their portfolio.'
'Future market gains will likely depend primarily on earnings growth.'
