The margins of tyre manufacturers could come under pressure given the rise in rubber prices and the moderating demand for tyres. In the past three quarters, the revenue growth for listed tyre companies has moderated from low to mid-single-digit on account of factors such as lower demand in replacement segments, weak export markets and the decline in the average selling prices to car makers (OEMs). Demand trends could remain muted in the near term, given the weak passenger vehicle replacement demand, assuming a typical replacement cycle of 3-5 years, and demand moderation in the OEM segment.
A higher opening in the domestic equity market also supported the rupee but dollar's gain against other currencies overseas limited the rise of domestic unit, forex dealers said.
The likelihood is that India will maintain a moderately upbeat economic tempo -- well short of tearaway growth, explains T N Ninan.
Foreign portfolio investors (FPIs) turned net buyers in October after being net sellers in the previous month. In October, FPIs bought shares worth nearly Rs 8,430 crore ($1 billion) against net selling of Rs 13,405 crore ($1.6 billion) in September. Positive flows during three of the previous four months have pushed the domestic markets towards fresh all-time highs. At present, the Sensex and Nifty are less than 2 per cent shy of breaching record highs logged in October 2021. A rally in equity markets in the US and Europe is in hopes that the Federal Reserve may go soft on rate hikes after its November meeting.
Citing the massive surge in Omicron infections and the resultant impact on overall economic activities in the March quarter, Swiss brokerage UBS Securities has revised downwards its India's growth forecast for the current financial year to 9.1 per cent from 9.5 per cent earlier. However, UBS Securities does not see the third wave impact extending to the next financial year as it has revised upwards its real GDP forecast to 8.2 per cent, up from 7.7 per cent earlier, expecting the real GDP growth to remain well above the historical average. The World Bank pegs it at 8.3 per cent, unchanged from its June assessment, saying the recovery is not broad-based yet.
This is slightly better than the fiscal deficit position last year when it was 85.6 per cent of the Budget target.
Fiscal deficit in first half of FY19 has already reached 95.3 per cent of full-year budget estimates.
India Inc on Friday said Prime Minister Manmohan Singh's assertion that the government will not impose capital controls, although reassuring to investors, must be supplemented with tough reform measures.
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.
India's exports remained in the negative territory for the 11th month in a row.
It would be a miracle indeed if we grow at 7/8 per cent a year over the current and next few years, says A V Rajwade
The rupee fell to an all-time low of 61.21 per dollar, forcing the Reserve Bank of India to intervene to stabilise the currency.
The Centre's fiscal deficit for the first two months (April-May) of the current fiscal has increased to Rs 90,758 crore, which is 27.3 per cent of the Interim Budget estimate, according to the Controller General of Accounts data released on Tuesday. The Budget estimate for the fiscal deficit in the year 2009-10 is Rs 3,32,835 crore.
India's gross tax revenue, comprising both direct and indirect taxes between April and July, reported a growth rate of merely 2.8 per cent to Rs 8.9 trillion compared to the same period a year ago, as shown by government data on Thursday. This growth was dampened by direct tax figures, offsetting the healthy growth in goods and services tax collections and Customs duties. While net tax revenue contracted by 12.6 per cent to Rs 5.8 trillion up to July, accounting for 25 per cent of the Rs 23.3 trillion full-year target, this could be attributed to the increased tax devolution to states during the period.
'Like every Budget, this time, too, there is chatter around tinkering with the long-term capital gains tax.' 'Investors may not want to jump into the markets until there is clarity on this front.'
India has much to be proud of and celebrate. But there is also much that is wrong, much that looks dangerous. Employment, current account deficit, rural distress, agricultural productivity are all in deep crisis, points out Shekhar Gupta.
How much are others responsible for the Trump presidency moving in the directions it has, asks T N Ninan.
For last fortnight, the tariff value of gold was fixed at $382 per 10 grams and silver at $516 per kg.
The government has hiked import duty on gold three times in a year and recently raised it by 2 per cent to 8 per cent to curb demand.
The Union government's finances witnessed significant improvement in August after a stressful first four months of the current fiscal year. India's gross tax revenue, comprising both direct and indirect taxes, for the first five months of 2023-24 surged 16.5 per cent year-on-year (Y-o-Y) to Rs 11.8 trillion. During the April-July period, gross tax revenue increased by a mere 2.8 per cent compared to the Budget Estimate of 12.1 per cent growth for FY24.
'We like certain stocks from banking, insurance, retail, hospitals and capital goods.' 'Though some of these stocks may seem expensive, they will compound well over the long term, thus justifying their current multiples.'
Forex dealers said besides dollar's gains against other currencies, increased demand for the American unit from importers put pressure on the rupee, but a higher opening in the domestic equity market limited the losses.
Volatility ain't going away any time soon. 2013 was the most volatile year for the rupee in at least the last 10, with 2009 not far behind.
Given the prevailing uncertainties, investors must maintain a 10-15 per cent allocation to gold in 2023.
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Policymakers stepped in late Thursday to calm markets.
Gold prices were ruling at Rs 26,385 per ten gram at the bullion market while silver was quoted at Rs 34,000 per kg.
Finance Minister Arun Jaitley on Friday tabled the pre-Budget Economic Survey in the Lok Sabha.
The sudden movement of the rupee - post the monetary policy - is not a reason to panic, said currency dealers. According to them, a correction was overdue for the rupee that remained the best performing currency in the region for well over a month. The rupee closed at 74.72 a dollar on Friday from its previous close of 74.60. It had dropped 1.52 per cent against the dollar on April 7 after the Reserve Bank of India (RBI) announced its monetary policy, committing to buy Rs 1 trillion of bonds in the June quarter. A weak rupee goes well with the export narrative of the government, and is consistent with the RBI's intervention strategy that prevented an appreciation.
Fiscal deficit touched Rs 90,678 crore (Rs 906.78 billion) during April-August, 2006, which accounted for 60.98 per cent of the budgetary target of Rs 1,48,686 crore (Rs 1,486.86 billion) for the whole year, he said in Delhi on Friday.
Credit rating agencies have been raising red flag over high debt to GDP ratio of India.
The government Rs 20 lakh crore package includes Rs 1.7 lakh crore of fiscal stimulus announced in the first phase, Rs 5.6 lakh crore stimulus provided through various monetary policy measures and Rs 5.94 lakh crore through the second phase, implying Rs 6.70 lakh crore package is still to be announced.
The currency market won't care for our moans, groans, cries and sighs. The rupee will find its own level, explains Tamal Bandyopadhyay.
S&P Global Ratings on Monday kept its forecast for India's economic growth unchanged at 6 per cent in the fiscal year starting April 1, before rising to 6.9 per cent in the following year. In the quarterly economic update for Asia-Pacific, S&P saw inflation rate easing to 5 per cent in 2023-24 fiscal, from 6.8 per cent in the current financial year. It saw India's gross domestic product (GDP) likely growing by 7 per cent in the current financial year ending March 31 (2022-23), before slowing to 6 per cent in the next 2023-24 fiscal.
A yellow glow is likely to stand out amid grey geopolitical clouds in 2023, with gold price projected to touch Rs 60,000 per 10 grams in the Indian market as more investors veer towards safe-haven assets. In a year where volatility was more a norm than an exception, gold prices in the international market oscillated from a peak of $2,070 per ounce in March to a low of $1,616 per ounce in November and is steadily recovering since then, according to market experts. At the beginning of 2022, gold prices were around $1,800 an ounce.
The fiscal deficit in the first five months of the current fiscal ended August stood at Rs 3.69 lakh crore, or 66.5 per cent, of Budget estimates for 2015-16.
After a contraction in the current financial year, India's economy is forecast to bounce back with a sharp growth rate of 9.5 per cent next year provided it avoids further deterioration in financial sector health, Fitch Ratings said on Wednesday. The coronavirus pandemic will lead to shrinking of the already slowing economy in 2020-21 that started in April. Fitch Ratings forecast a 5 per cent contraction in the GDP in the ongoing financial year.
India's economy grew 7.6 per cent in the September quarter of this fiscal and remained the fastest-growing large economy, mainly due to better performance by manufacturing, mining and services sectors, the government data showed on Thursday. The gross domestic product (GDP) expanded by 6.2 per cent in the July-September quarter of 2022-23. India remained the fastest-growing major economy, as China posted a 4.9 per cent growth in July-September 2023.
The rupee resumed higher at 61.75 as against the last closing level of 62.05 per dollar at the Interbank Foreign Exchange (Forex) Market and firmed up further to a one-month high of 61.53 before quoting at 61.59 per dollar at 1045 hours.
Expressing disappointment over the RBI's move for not cutting the key policy rates, India Inc on Tuesday asked the government to take immediate action to revive growth and boost investments.
'Your decisions should not be driven by your view on the market, but by your objectives, risk appetite, and time horizon.'
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