India Chart Pack Services “outperformance” unlikely to last In contrast to many other economies, the 20% y/y slump in India’s services sector in Q2 was less pronounced than that in industry, which collapsed by almost 40% y/y. But we doubt that the... 24th September 2020 · 9 mins read
RBI Watch Loosening cycle is not over yet We agree with market and analyst expectations that the Reserve Bank’s new-look MPC will keep rates on hold at the conclusion of its meeting on Thursday 1st October. But with inflation set to drop... 23rd September 2020 · 6 mins read
Asia Economics Update Fortunes diverge in South Asia Success in bringing the COVID-19 outbreak under control in Pakistan, Sri Lanka and to a lesser extent Bangladesh has enabled activity in these places to rebound much faster than in India, where new... 22nd September 2020 · 3 mins read
India Economics Weekly Vehicle sales strength, rupee weakness The jump in passenger vehicle sales in August contrasts with other indicators showing that the post-lockdown economic recovery is stuttering. We suspect this is mostly a reflection of consumers making... 18th September 2020 · 3 mins read
India Economics Update Trade data point to sluggish demand recovery The widening in India’s goods trade deficit in August won’t put the external position at risk, but the underlying data suggest that the recovery in external and domestic demand is stuttering. 16th September 2020 · 2 mins read
India Data Response Consumer Prices (Aug.) Following the greater-than-expected rise in wholesale price inflation last month, it will come as some relief to policymakers that consumer price inflation held steady in August. That said, core... 14th September 2020 · 2 mins read
India Data Response Wholesale Prices (Aug.) Wholesale price inflation rose by more than most had expected in August, due mainly to a jump in the core component. A similarly sharp rise in core consumer price inflation last month – data will be... 14th September 2020 · 2 mins read
India Data Response Industrial Production (Jul.) The contraction in industrial output eased a little further in July but was still well below pre-virus levels. With India now on course to becoming the epicentre of the coronavirus, restrictions are... 11th September 2020 · 2 mins read
India Economics Weekly Becoming the virus epicentre India this week overtook Brazil to become the second-worst affected country by the COVID-19 pandemic, and it is only a matter of time before its total virus cases surpasses those in the US. This grim... 11th September 2020 · 5 mins read
India Economics Update What next for government borrowing costs? The use of traditional monetary policy tools alongside financial repression will keep government borrowing costs in India in check over the coming years. That should help to ensure that only modest... 9th September 2020 · 3 mins read
India Economics Weekly Economy to contract by 10% this year The shocking GDP data for Q2 and signs of a weak recovery have led us to revise down our expectations for growth in 2020. We are now forecasting GDP growth of -10% (previously -5.5%). Further ahead... 4th September 2020 · 4 mins read
India Data Response Services & Composite PMI (Aug.) The rise in the August PMIs pales in comparison with the falls during the lockdown and it is highly likely that output is still a very long way from pre-pandemic levels. Given the bleak economic... 3rd September 2020 · 2 mins read
India Economics Update Inflation close to peaking Ongoing virus-related supply disruptions as well as one-off factors such as phone tariff hikes have kept inflation higher than we had anticipated over recent months. But with food inflation set to... 2nd September 2020 · 4 mins read
India Data Response Manufacturing PMI (Aug.) The rise in August’s manufacturing PMI is cold comfort when set against the extremely weak GDP data for Q2 released yesterday. And with new coronavirus cases showing no signs of abating, we think the... 1st September 2020 · 2 mins read
India Data Response GDP (Q2) The 24% y/y slump in Indian GDP in Q2 (Q1 of FY20/21) is one of the largest peak-to-trough falls anywhere in the world. With the country still battling with its coronavirus outbreak, the rebound in... 31st August 2020 · 2 mins read
India Economics Weekly OMOs ramped up, lifeline for borrowers The RBI this week announced new open market operations aimed at stabilising long-term bond yields. We think this is a sign of things to come as the authorities aim to keep government borrowing costs... 28th August 2020 · 6 mins read
