India Economics Update A brief foray into current account surplus India’s current account swung into a rare surplus in Q1. That probably won’t last for long as oil prices rebound, remittances drop and the trade deficit starts to widen again over the coming months... 1st July 2020 · 3 mins read
India Economics Update BJP building its political strength Recent developments have strengthened the ruling BJP’s hand in the Rajya Sabha (the upper house of parliament). This should help to ease the passage of economic reforms, provided that the BJP has the... 22nd June 2020 · 3 mins read
India Economics Update Remittance slump would add to economic woes Worsening employment prospects for Indian migrants in the Gulf and the US mean that remittance inflows are likely to drop even as lockdowns are eased. While this won’t have severe ramifications for... 17th June 2020 · 3 mins read
India Economics Update Trade data provide cold comfort The slight easing in the y/y contraction in goods exports and imports in May supports evidence from elsewhere that the worst has now passed for the economy. But both remain extremely weak, and a sharp... 16th June 2020 · 2 mins read
India Economics Update Industry past the worst but recovery will be slow Industrial output ground to a halt in April but high-frequency indicators including electricity consumption and air pollution levels suggest that activity has edged up since then. However, lasting... 15th June 2020 · 2 mins read
Asia Economics Update South Asia and the lockdown dilemma Lockdowns are being eased in India, Pakistan and Bangladesh without any sign that coronavirus infections are being brought under control. Economic recoveries will face greater headwinds than in places... 9th June 2020 · 3 mins read
India Economics Update MPC minutes suggest further loosening likely The minutes of the Reserve Bank’s late May policy meeting – in which it trimmed both the repo and reverse repo rates – show that the MPC has become markedly more bearish on the outlook for economic... 8th June 2020 · 2 mins read
India Economics Update Inflation should not constrain policymakers Daily price data give a strong indication that food inflation dropped in May, most likely as supply disruptions eased a touch and agricultural activity was allowed to resume. With global oil prices... 4th June 2020 · 3 mins read
India Economics Update Reforms through the back door Prime Minister Modi’s BJP has expedited structural reforms that normally face stiff political resistance, ostensibly as part of efforts to support recovery from the coronavirus crisis. These moves... 2nd June 2020 · 3 mins read
India Economics Update Cash to remain king for a long while yet Amid the severe economic damage that the coronavirus and containment measures have caused, one potential positive is the greater prevalence of cashless payments as people make more purchases from home... 28th May 2020 · 3 mins read
India Economics Update RBI ramps up virus response, more easing in store The RBI has further stepped up its response to the collapse in economic activity from the coronavirus and containment measures in another emergency announcement today. The central bank has also left... 22nd May 2020 · 3 mins read
India Economics Update Stimulus disappoints amid lockdown extension The final details of the stimulus package reinforce our initial take that, while helpful in limiting downside risks to the economy, it will do little to boost demand in the near term. With the... 18th May 2020 · 3 mins read
India Economics Update Trade data indicate extreme weakness in demand The 60% y/y contraction in goods exports and imports in April highlights the extreme weakness of external and domestic demand. This will probably mark the bottom as restrictions on activity are... 18th May 2020 · 2 mins read
India Economics Update Will stimulus push up government financing costs? The new fiscal stimulus will substantially push up India’s already-high public debt ratio. Policymakers may have to resort to unusual steps to keep borrowing costs in check, including further... 14th May 2020 · 3 mins read
India Economics Update New fiscal package is less spectacular than it seems Prime Minister Modi’s 10% of GDP support package sounds impressive but the details just announced make clear that it has been bulked out for effect. Extra demand-boosting measures are worth less than... 13th May 2020 · 4 mins read
India Economics Update Industrial recovery a long way off Industrial output slumped in March and more timely evidence from the manufacturing PMI, electricity consumption and vehicle production strongly suggest that the sector has come to a near standstill in... 12th May 2020 · 2 mins read
