HISTORIC ECONOMIC POLICIES
Rafale’s India operations get a strategic push; Dassault establishes maintenance facility near Jewar Airport
Dassault Aviation is advancing plans to establish a Maintenance, Repair, and Overhaul (MRO) facility near Jewar International Airport for India’s Mirage 2000 and Rafale fighters. This move supports India's aspiration to locally manufacture the latest Rafale versions under the "Make in India" initiative. Engine maker Safran SA also intends to set up an MRO facility for Rafale engines in Hyderabad, aiming for operations by 2025 and potential local production of M-88 engines. These developments are crucial as India seeks to bolster its defense capabilities amidst regional security challenges, including from China's expanding military presence.
Don't obsess on inflation targets
In my capacity, I stress the importance of preparing for the AI revolution and managing public funds wisely to navigate economic uncertainties. Governments must prioritize debt sustainability and structural reforms to ensure long-term prosperity and stability.
S&P 500 tops 5,500 after ‘near perfect’ economic data
Excluding the volatile food and energy components, the core inflation figure rose by 0.1% month-on-month and 2.6% year-on-year. According to LSEG FedWatch data, the probability of a rate cut in September increased to 68% from 61% prior to the release of the data. Despite the Federal Reserve's projections of only one rate cut this year, traders are maintaining their bets on two cuts, hoping for a continued decline in inflation and considering the economy's vulnerability to historically high interest rates.
Budget will announce historic steps, present a ‘futuristic vision,’ says President Murmu
President Murmu said that today India alone contributes to 15% of the global growth and reiterated her government’s commitment to make India the third largest economy in the world. She sought the support of the Opposition to meet this goal, invoking the Vedas and said all sides should work together “with a common idea and goal”.
Budget in mind, D-St bulls cross 'historic' milestone
Analysts said the sustained run-up in indices of late is part of the pre-budget rally, aided by renewed flows from foreign investors in June. The optimism, however, did not rub off on the broader market where there were more losers than gainers.
Budget 2024 will see many historic economic policies, will be a futuristic one: President Murmu at Parliament
In her address to Parliament, President Droupadi Murmu announced that the upcoming Union Budget will introduce historic economic policies and reforms at an accelerated pace. Highlighting India's contribution of 15% to the global economy, she emphasized that this budget will reflect the government's long-term policies and futuristic vision. Finance Minister Nirmala Sitharaman is set to present this Union Budget in July 2024.
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"President's address is actually the speech of the government," says Akhilesh Yadav
Samajwadi Party chief Akhilesh Yadav responded to the President's Address to the joint session of Parliament, noting it as a traditional representation of the government's views. He emphasized the significance of the speech as reflecting the government's stance. Meanwhile, Congress MP Pramod Tiwari criticized the government, describing it as tired and lacking willpower, with nothing new to offer for the nation's benefit. Congress leader Imran Masood echoed similar sentiments, alleging that the address was predetermined amidst what he termed as a situation akin to an emergency.
What should be your investment strategy after elections?
Market volatility post Indian election triggered short-term turbulence, yet history shows eventual alignment with economic fundamentals. Resilient corporate earnings, infrastructure development and vigilant sector monitoring are emphasized for long-term strategic investments amidst fluctuating market conditions.
In 10 years, India no longer a charity case, it's the driving force of world economy: Sanjeev Sanyal
There are no such things as poor people. They are poor places. Say two brothers grew up in Moradabad. One of them stays back in Moradabad and another went off to Dubai. After five years, one person will be earning a lot more than the other. Why does this happen? It is because places matter, says Sanjeev Sanyal
Job creation is India's top economic challenge, policy experts say
According to a poll of policy experts by Reuters, tackling India's chronic joblessness will be the biggest challenge for the government over the next five years, despite the country's status as the world's fastest-growing major economy. The economy grew more than 8% last fiscal year, but this growth has not translated into sufficient job creation, particularly for young people. The recent parliamentary elections saw Prime Minister Narendra Modi's BJP losing its majority, partly due to issues such as widening inequality, inflation pressure, and a lack of well-paying jobs.
ETMarkets Smart Talk: FMCG & IT stocks provide valuation comfort compared to historical valuations: Vipul Bhowar
Populist policies will likely take precedence to secure victory in a coalition setup. Key cabinet portfolios, particularly those related to finance, defence, and infrastructure, will be closely monitored.
Economists expect big-bang reforms to continue under Modi 3.0
Modi is set to be sworn in for third term as India's Prime Minister in coalition government with key partners Telugu Desam Party and Janata Dal (United). Economists anticipate focus on economic reforms to achieve goal of Vikshit Bharat by 2047. Budget to prioritize infrastructure, manufacturing, and welfare schemes amid global economic challenges.
Modi premium for Indian stocks gets a hard look after elections
With the leader now navigating coalition politics after a weaker-than-expected mandate in this week’s national election, the so-called Modi premium is under scrutiny. Investors are looking for proof that Modi can continue his reforms with the same vigor, while balancing the demands of alliance partners and avoiding populist measures to regain public support.
As Modi 3.0 begins, where the economy stands, where it's headed
Narendra Modi is set to begin his third term as PM with a full-strength NDA team, amidst optimism for India's economic future. RBI Governor Shantikanta Das highlighted the country's robust economic growth, strong manufacturing sector, recovering rural demand, and promising investment activity. India's external sector remains resilient, with positive growth prospects ahead.
Lok Sabha results won't force India's budget to make significant policy shifts: Fitch
Fitch Ratings anticipates minimal policy shifts in India post-election losses. The upcoming July budget will detail economic reform plans and fiscal goals for the next five years, crucial for addressing fiscal metrics, reducing debt, potential deviations from capital expenditure commitments, the risk of heightened social spending, progress in judicial reforms at the state level, and reforms in the manufacturing sector.
New govt to inherit strong economy, focus on making India developed nation by 2047
India's record-breaking economic growth rate and strong tax revenues provide a foundation for future reforms aimed at transforming the country into a developed nation by 2047. The new government must address challenges such as unemployment and rural distress, while also focusing on controlling inflation. Despite potential obstacles, experts expect continued infrastructure-led growth, investor-friendly policies, and reforms to maintain India's economic momentum and attract investment.
Pakistan inflation slows to 11.8% in May, lowest in 30 months
The lowest reading comes a week before the central bank meets to review the key rate which has remained at a historic high of 22% for seven straight policy meetings.
US risks a ‘Forever’ trade war with China, says Economist Stephen Roach
The US is erecting new trade barriers that will hold back China’s sales of key products like electric vehicles, accusing Beijing of building excess capacity using state subsidies and flooding global markets with cheap products.
China's factory activity unexpectedly contracts in May
China's manufacturing activity fell in May, with the official factory survey showing a decline. Calls for fresh stimulus persist due to the ongoing property crisis impacting businesses, consumers, and investors.
Election outcomes won't disrupt India's economic stability: Saurabh Mukherjea
There will probably be governance continuity as well, but almost certainly there will be policy continuity and hence, my point of view to the foreign investors is, beyond a point, you should not overemphasise the elections.
How has Modi's approach to governance and media evolved since last decade? Santosh Desai answers
And of course, this whole mobilising together of the Hindu, sort of the sentiment of the sense that historically they have been discriminated against. I would say, almost a sense of masculine inadequacy of a certain kind.
IMF upgrades China's 2024, 2025 GDP growth forecasts but warns of risks ahead
"China's economic growth is projected to remain resilient at five percent in 2024 and slow to 4.5 percent in 2025," the IMF said in a press release, adding the decision was "driven by strong first-quarter GDP data and recent policy measures".
RBI MPC meeting next week: What investors should expect
The RBI's upcoming MPC meeting on June 7, 2024, is expected to maintain interest rates amidst a stable inflation scenario post Lok Sabha election results. The focus will be on global and domestic factors impacting the economy.
Crypto Talk: Election year economic policies could propel Bitcoin to new heights, predicts Rajagopal Menon of WazirX
2024 is projected to be a significant year for cryptocurrencies with government spending expected to rise, leading to a potential reduction in interest rates. Bitcoin's price surge post-halving is driven by factors like institutional demand and cyclical patterns. Rajagopal Menon says no one who has held Bitcoin for more than 4 years has ever lost money. Systematically buying Bitcoin every month, similar to investing in a mutual fund, can be an effective strategy.
Goldman says equity investors bracing for return of volatility
Stock investors are bracing for a spike in market volatility, and upcoming events such as Nvidia Corp.’s earnings report can exacerbate any moves, according to Goldman Sachs Group Inc. strategists.
‘We are witnessing the return of industrial policy now — unlike the past, this is shaped by a globalised world, climate change and AI’
"Right now, in the post-global financial crisis era, and particularly post-Covid, we are seeing the return of industrial policy but it’s taking a different form from the past — it is far more financialised now, it tries to work within the parameters and institutions of a globalised world and it is much more outward-oriented."
ETMarkets Smart Talk: Nifty hitting 24K is subject to Indian elections results and Middle East tensions: Sandeep Raina
Sandeep Raina of Nuvama projects Nifty50 levels at 24,000 to 25,000 based on expected EPS, influenced by Indian Elections and Middle East tensions. Market trends may align with US Fed’s policies, impacting inflation and equity performance. Raina further says that Indian markets will largely respond to the corporate earnings reports.
IMF warns industrial policy no magic cure for slow economic growth
Focusing mainly on subsidies and tax breaks posed risks, given high fiscal costs, the risk of capture by special interests and possible massive mis-allocation of resources, said Era Dabla-Norris, a deputy director of the IMF's Fiscal Affairs Department. Policies that discriminated against foreign firms could also trigger retaliation, entrenching geo-economic rifts.
The great central bank policy reversal kicks off
Major central banks are poised to reverse a series of record interest rate hikes, but the descent in borrowing costs will be gradual and cautious. Economic factors, including concerns about inflation and structural shifts, will influence the pace and extent of rate cuts by major central banks like the Fed and ECB.
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