India Economics Update The economic impact of the monsoon Early forecasts of “average” levels of rainfall during this year’s monsoon have led to a rush of speculation on the potential economic impact. But the early forecasts are prone to revision and, in any... 9th April 2018 · 1 min read
India Economics Update Core inflation to remain elevated Consumer price inflation is likely to have eased in February, due to a further drop in food inflation. But core price pressures are still building. We think this will ultimately prompt the Reserve... 6th April 2018 · 1 min read
India Economics Update RBI holds rates, but tighter policy on the horizon The RBI’s decision to hold its repo rate at 6.00% today came as no surprise. But we think that elevated core inflation and looser fiscal policy will prompt the central bank to raise interest rates in... 5th April 2018 · 1 min read
India Economics Update Prospects for the rural economy are bright After taking a significant hit in the aftermath of demonetisation in late 2016, India’s rural economy has regained momentum in recent months. Future prospects for the rural economy look bright, in... 28th March 2018 · 1 min read
India Economics Update Equities likely to fall further Indian equities have continued to drop so far in March, even as many other major stock markets have stabilised after the turbulence in February. Looking ahead, we expect Indian equities to fall a bit... 22nd March 2018 · 1 min read
India Economics Update Should we be worried about capital flows? A drop in foreign direct investment inflows and a pick-up in portfolio inflows into India has led to concerns that the economy is once again becoming vulnerable to a sudden halt in foreign financing... 21st March 2018 · 1 min read
India Economics Update Trade deficit stabilises as protectionist clouds gather India is one of many economies facing a more protectionist stance from the US. Its dependence on exports to the US is low though, an inadvertent positive stemming from its failure to develop a world... 15th March 2018 · 1 min read
India Economics Update PNB scandal highlights need for governance reforms The fraud scandal engulfing Punjab National Bank, India’s second largest state-owned bank, is a stark reminder that recent measures to revive the banking sector, including the recapitalisation package... 13th March 2018 · 1 min read
India Economics Update Drop in headline inflation to prove temporary Consumer price inflation is likely to have eased in February, due to a drop in food and fuel inflation. But core price pressures are still building. We think this will ultimately prompt the Reserve... 8th March 2018 · 1 min read
India Economics Update State elections come into focus Prime Minister Modi is facing his busiest year of state elections in 2018. Elections that are due to take place this year will have an important bearing on economic policy at the local level, and will... 27th February 2018 · 1 min read
India Economics Update Local markets unable to escape global rout Indian financial markets have not been able to escape the recent turmoil in global markets, with equities dropping sharply and the rupee weakening against the US dollar. Looking ahead, we expect... 22nd February 2018 · 1 min read
India Economics Update MPC minutes reiterate inflation and fiscal concerns The minutes of the Reserve Bank of India’s (RBI’s) February policy meeting show that most MPC members are concerned about recent fiscal developments and the inflation outlook. Indeed, with core... 22nd February 2018 · 1 min read
India Economics Update Trade deficit unlikely to widen much further India’s monthly trade deficit widened to its highest level since the taper tantrum in January. But we don’t think this is reason to panic just yet. Exports should rebound following disruptions related... 15th February 2018 · 1 min read
India Economics Update Reserve Bank is right to turn more hawkish Consumer price inflation is likely to have accelerated again in January, due to another rise in food inflation. But core price pressures are also continuing to build. This was acknowledged by the RBI... 8th February 2018 · 1 min read
India Economics Update RBI turns more hawkish The RBI’s decision to hold its repo rate at 6.00% today came as no surprise but it sounded notably more hawkish in the policy statement. This supports our non-consensus view that rate hikes are likely... 7th February 2018 · 1 min read
India Economics Update FY18/19 budget: fiscal deficit targets relaxed The finance ministry faced a tricky balancing act in today’s budget announcement for FY18/19 as it aimed to shore up popular support ahead of a busy 18 months of elections while also demonstrating... 1st February 2018 · 1 min read