India Economics Weekly Activity bottoming out The continued drop in new virus cases has coincided with a bottoming out in some of the real-time activity data, and the evidence from last year suggests that activity could bounce back rapidly when... 28th May 2021 · 5 mins read
India Economics Weekly Labour market taking a hit, Cyclone Tauktae High-frequency data show that job losses are starting to mount, but a key lesson from last year is that the labour market can recover quickly once virus restrictions are lifted. That provides hope... 21st May 2021 · 3 mins read
India Economics Weekly Slowdown in vaccine rollout casts a dark cloud New virus cases in India remain extremely high, but there have at least been some encouraging signs this week that the current wave is close to peaking. However, lacklustre progress with the... 14th May 2021 · 3 mins read
India Economics Weekly Reasons for hope and despair New infections in a handful of key states including Maharashtra now appear to be stabilising but, with the virus still spreading in almost every other part of the country, containment measures will... 7th May 2021 · 5 mins read
India Economics Weekly Signs of financial stress emerge The sharp widening in credit spreads over the past few days will have concerned policymakers and - like last year - a forceful response is likely if further signs of financial stress emerge. But while... 30th April 2021 · 5 mins read
India Economics Weekly How damaging will be the new restrictions be? With the economic damage from last year’s lockdown still fresh in the memory, there appears to be little appetite for a return to extreme measures to curb the ongoing outbreak. But given the very... 23rd April 2021 · 4 mins read
India Economics Weekly Investment recovery enters a slower phase Monthly data suggest that the recovery in investment has slowed, and headwinds are mounting too. The surge in virus cases means lots of firms will tread with caution in the near term, while problems... 16th April 2021 · 3 mins read
India Economics Weekly QE or not QE isn’t really the question The RBI's new bond purchase programme announced this week has led to comparisons with quantitative easing (QE), but there appears to be some subtle differences. In truth however, it matters little... 9th April 2021 · 6 mins read
India Economics Weekly Inflation target maintained, external risks diminished Confirmation that the RBI’s current target of 4% headline inflation will be maintained for another five years is the best outcome from an economic perspective, as tinkering with it could have un... 1st April 2021 · 5 mins read
India Economics Weekly NPL floodgates open, new FX forecasts, state elections With the Supreme Court this week lifting its ban on banks classifying delinquent loans as non-performing, the last major extra-ordinary banking sector measure has been unwound and recorded NPLs are... 26th March 2021 · 4 mins read
India Economics Weekly Renewed virus outbreak a key downside risk The rise in new COVID-19 infections to a three-month high this week does not appear to be a major threat to India's economy yet as cases are still comparatively low and the outbreak has predominantly... 19th March 2021 · 3 mins read
India Economics Weekly Markets are jumping the gun on RBI rate hikes Financial markets appear increasingly convinced that the RBI is on the cusp of monetary tightening, perhaps due to fears of a re-run of the Taper Tantrum in 2013. But India isn’t as vulnerable to a... 12th March 2021 · 6 mins read
India Economics Weekly Stage is set for a faster economic recovery India's economic recovery continues to proceed faster than we’d expected. We are revising our forecast for GDP growth this year to 13.5%, above consensus expectations of an 11% rise in output. With... 5th March 2021 · 5 mins read
India Economics Weekly Does the inflation target need an overhaul? The debate over the RBI's 4% headline inflation target - which runs until next month and is currently being reviewed - has heated up this week. Some prominent government officials have suggested that... 26th February 2021 · 5 mins read
India Economics Weekly Investment recovery, oil price impact The latest monthly activity data suggest that investment staged a stronger recovery than we had anticipated at the end of 2020 and, as such, we are nudging up our estimate of Q4 GDP. Meanwhile, the... 19th February 2021 · 4 mins read
India Economics Weekly Policymakers will keep a lid on borrowing costs Indian yields rose significantly in the aftermath of the unexpectedly-accommodative Union Budget announcement but developments since - including a ramping up of open market operations - have helped to... 11th February 2021 · 5 mins read
