Economy & Strategy

September trade deficit widened by USD5bn to USD 32bn led by gold imports; core deficit (ex-oil, gold) was steady at USD13bn. Highlights: i) Growth in core exports (ex-oil, gold) is stable at 8% YoY (3MMA), with

US economy: Will consumption hold up amid tariffs and weakening labour markets?: The US labour market is slowing sharply and so is the housing market. At the same time, tariffs have started to move higher, with the

The MPC left the repo rate unchanged at 5.5% (unanimous) and the policy stance ‘neutral’, although it noted that the space for further easing has opened up given a more benign inflation outlook. For now, policymakers

FP Intro

At the upcoming MPC meet, a rate cut shall be a close call. While weak demand, steep tariffs and benign inflation call for the RBI to complement the government’s GST reform by a rate cut, the MPC may like to wait and see

August trade deficit narrowed modestly, but remains quite elevated at USD26.5bn (USD27.4bn in July) while ex-oil deficit widened further to USD17.7bn from USD16.1bn in July. Highlights: i) core exports (ex-oil) held

CPI rose to 2.1% YoY in August (from 1.6% in June), in line with market expectations. Key trends: i) Food inflation was flat (0%) after two months of contraction as vegetables’ deflation eased a bit (from -21% to -16%).

GST tax cuts will hit revenues modestly (0.2% of GDP), but the removal of compensation cess turns the fiscal impulse from negative to neutral in FY26 and expansionary (~0.5% of GDP) in FY27 assuming no further

Q1FY26 RGDP growth jumped to 7.8% (Q4FY25: 7.4%) while NGDP slowed to 8.8% (Q4FY25: 10.8%) as the deflator dropped to 1% (Q4FY25: 3%). The jump in real GDP is more of a statistical boost; the bulk of high-frequency

Quarterly numbers matter; they lend a quantitative as well as qualitative sheen to what has been (Q1FY26 review). But management quotes go far beyond plain-vanilla numbers: they offer deeper insights into what individual

PAT and top line remain weak: BSE500 (ex-OMCs) posted top-line/profit growth of 7% YoY with margins holding up at elevated levels amid subdued top lines. A trend similar to FY25. Cement’s and Chemicals’ profits’

Picking winners or losers based on tariff differentials is missing the woods for the weeds. The elephant in the room is the coming narrowing of the US CAD (unwinding of global imbalances)—a deflationary dynamic. Orderly

CPI eased further to 1.6% YoY in July (from 2.1% in June), marking the lowest reading since 2017. Key trends: i) Food inflation slipped to -0.8% YoY from -0.2% in June led by a 21% YoY drop in vegetable

After front-loading a 50bp-rate cut and shifting to a ‘neutral’ stance at the last policy, we see MPC holding rates steady at 5.5%. In fact, the RBI governor hinted at limited room for further cuts. Yet, we think the

The US could impose a 25% tariff on India, lower than China, but higher than others. While this may still change, a few points are worth noting: i) India’s goods exports to the US may be hurt, but it is small as a share

Global economy: Of weaker dollar and global imbalances DXY weakness—What’s different this time? Historically, USD weakness worked to reflate the global economy through: i) rise in global asset prices; ii) triggering EM

Trade deficit in May narrowed to USD21.9bn from USD26.4bn in April, driven by a USD4.3bn reduction in oil trade deficit. Highlights: i) Core exports (ex-oil and gold) grew 6% YoY in May (versus 2% in April) on a 3mma

In a surprise move today, the MPC cut the repo rate by a bigger-than-expected 50bp to 5.5% and slashed the CRR by 100bp. This front-loading of rate cuts and liquidity injections are welcome and should aid transmission.

Quarterly numbers matter; they lend a quantitative as well as qualitative sheen to what has been (Q4FY25 review). But management quotes go far beyond plain-vanilla numbers: they offer deeper insights into what individual

We anticipate the MPC to cut rate by 25bp and potentially guide for more cuts. Demand conditions continue to soften, as seen in slowing credit growth, auto sales, RE sales and HH wages while inflation too has turned