The Indian Rupee hit all-time lows of 83.4550 this week on a strong US Dollar and FII outflows. The Dollar index has strengthened 2.87% YTD while FII outflows stood at Rs 52,461 crores YTD. Elevated gold and crude oil prices due to heightened geopolitical tensions in the Middle East and between Ukraine and Russia also … Read more
Retail inflation in India eased a tad in February to 5.09 per cent from 5.10 per cent the prior month. It was at a four-month high of 5.69 per cent in December. The retail inflation in India though is in RBI‘s 2-6 per cent comfort level but is above the ideal 4 per cent scenario. … Read more
Forecasting a steeper fall in inflation to the tune of 50 bps lower than previously projected, a Wall Street brokerage sees the central bank leaving the policy rates unchanged at 6.5 per cent in the forthcoming review on June 8. Analysts at Goldman Sachs India in a report on Friday said the headline inflation will … Read more
Most global central banks may be either close to a peak or already done with interest-rate hiking, auguring a hiatus before possible monetary loosening comes into view. With the first signs of dents in economic growth now visible, and fallout from financial-market tensions lingering, any pause by the Federal Reserve after at least one more … Read more
A “revenge rebound” in spending is generalising price pressures and making them persistent as impact of initial inflationary pressure, delivered by successive supply shocks, have waned, said a Reserve Bank of India paper on Tuesday. The paper, that analysed inflation trajectory in the country after February 2022, said that supply-side shocks resulting from the Russia-Ukraine … Read more
The dollar was firm on Tuesday leading in to the release of U.S. inflation data and the final Federal Reserve meeting of the year, with investors waiting to update interest rate outlooks. A month ago, a small surprise to the downside unleashed a wave of bond-buying and dollar selling on the expectation that inflation had … Read more
For the past couple of years, the focus of markets and financial stakeholders on hitting the inflation target of 4% was diluted. The focus was to support growth and be okay with turning a blind eye to inflation breaching the upper limit. Furthermore, the market seemed a little too much interested in the Fed rates … Read more
The Reserve Bank of India expects fiscal and other supply side measures like excise duty cuts to address inflation concerns though it expects inflationary pressure to build up through rise in input prices. Cost-push pressures continue to impinge on core inflation, though their pass-through may remain muted due to the slack in the economy, the … Read more
After three successive quarters of above-target inflation, there are signs that inflation may have finally peaked, Barclays India said in a report. Favourable base effects, improving supply constraints and a small reversal in food prices will likely have a moderating effect on CPI inflation over coming months, it said. In its estimation, inflation will remain … Read more
The flexibility that RBI has been able to show in response to the Covid-19 crisis is the most recent case in point. Synopsis But the key point is that the monetary policy is working, and GoI and RBI need to allow it to continue. What do we mean by ‘functioning quite well’? First, RBI responds … Read more