India Economic Scan
In this edition: Indian economy seen pulling out of slowdown, Fitch warns India on budget deficit impact on credit rating, Indian business confidence improves in FY10, India's inflation slows to 0.48%, Indian ADRs rebound.
Top headlines
Economy seen pulling out of slowdown - paper
- India's economy should emerge from its downturn soon, a poll of chief executives of 31 companies by a newspaper showed on Thursday.
- All but 10 out of the 31 chief executives polled believe that India has seen off the economic slowdown, raising hopes the new government will inherit an economy that is on the mend, The Economic Times daily, said. (Reuters)
- “India faces considerable challenges in balancing the need for short-term stimulus measures to counter the economic downturn and the necessity of re-establishing a sustainable medium-term path for the country’s public finances,” Fitch said in an e-mailed statement today.
- Fitch, which has assigned India a BBB- rating, its lowest investment grade, expects the nation’s new government to step up spending to arrest slowing economic growth. That will widen India’s national budget deficit, including state government finances, to more than 10 percent of gross domestic product for the second year in a row, according to Fitch. (Bloomberg)
India business confidence improves in FY10 - survey
- India's business confidence for the first half of the fiscal improved on hopes the economy would revive later in the year, but global economic instability and slowing consumer demand still weigh, a survey showed.
- The survey, released on Thursday by the Confederation of Indian Industry (CII), comes amid talk of a recovery in Asia's third-largest economy following encouraging car sales and signs of reviving manufacturing activity in April. The CII Business Confidence Index for April-September 2009-10 rose 2.4 points to 58.7 from October-March 2008-09. (Reuters)
India’s Inflation Slows to 0.48% in Week Ending May 2
- India’s inflation rate stayed under one percent for a ninth week, giving the central bank room to maintain record-low interest rates and support economic growth.
- Wholesale prices rose 0.48 percent in the week to May 2 from a year earlier after increasing 0.70 percent in the previous week, the government said in New Delhi today. Economists expected a 0.30 percent gain. (Bloomberg)
Indian Stocks Trading in U.S. Rebound, Led by ICICI Bank
- ICICI Bank Ltd. India’s second-largest lender, jumped more than 6 percent on the New York Stock Exchange. Tata Motors Ltd., India’s biggest maker of commercial vehicles, rose 4.3 percent on the prospect that a growing economy will boost sales of its Nano car.
- The Bank of New York Mellon India ADR index gained 3.8 percent to 578.43, the most since May 4. (Bloomberg)
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