Happy Thursdays! What else to expect..(Early Report)

HSBC in Kolkata
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Inflation WoW came out as expected at 11.7% for food inflation, 12.86% for Primary Articles and the consolidated number at 9.02% ahead of the unscheduled eGOM meeting for Diesel and Kerosene price corrections that will keep inflation up. Expectations are normalising to a higher level and in an hour or so the bank policy for the rest of the year may become clearer with the Bank rate 100bips above the Repo rate and currently at 8.25% (Repo 7.25%) likely heading to a above 10% figure andd more as imported inflation and the one carried into input prices squeezes profitability factors in yet bereft India forver waiting for new investors..This article will be updated later throughout the day

HSBC and Stanchart have come out as the only ones carrying forward from here being used to a Rupee Trillion of business assets each in the country. MoM inflation WPI figures had earlier come to 9.06% on Monday night and markets have started correcting from 5500, results a few weeks later probably accelerating the down move this time and the yield curve moving after the announcement further higher from 8.3 to even 9 – 9.5 % in the next quarter or so. Banks’ pricing will move as also for deposits after a couple of months if and when inflation stays at 9-9.5% and RBI makes a new set of more quicker baby steps just to stay on top till the rates start moving southward in 2012

The monthly inflation figure saw non Food core inflation move from 6.5% to 7% Month on month and base transmission is on to manufactured articles as car prices were hiked this week while FMCG / durables keep playing with their own retailer economy.

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