The massive increase in healthcare spends, especially in the hinterland, steadily rising fuel prices and online delivery of articles will increase inflation pressure much higher on one hand and crowd out other consumer spending on the other, putting a big question mark on overall growth that s still being driven by consumption demand, according to a report. Soumya Kanti Ghosh, the group chief economic adviser at State Bank, in a note also noted that the steep fall in retail inflation in April to 4.29 per cent from 5.52 per cent in March is deceptive, as the CSO inflation number is primarily due to easing food prices as the rural core inflation has jumped to 6.4 per cent.
Rupee appreciates on expectations of weak dollar, global risk sentiment
May 10, 2021
The rupee could see an appreciating bias on expectations of a weak dollar and global risk sentiment, channelising the greenback towards high-yielding assets and keeping domestic financial markets supported, say experts.
The domestic unit has appreciated about 60 paise
vis-a-vis the dollar so far this month. It has strengthened from 73.95 per dollar on May 3 to 73.355 on May 10.
Abhishek Goenka, Founder and CEO, IFA Global, observed that the dollar got hammered after the US April jobs data missed expectations by a huge margin on Friday.
The US headline non-farm payroll came in at 2,66,000 against expectations of 10,00,000. “The weak data print would cause the markets to align with the Fed communication of extremely gradual withdrawal of accommodation. The dollar has weakened across the board.
Finance ministry report sees muted hit to economy from 2nd Covid wave
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Finance ministry report sees muted hit to economy from 2nd Covid wave
TNN / Updated: May 8, 2021, 06:39 IST
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New Delhi: The second wave of Covid has posed a downside risk to economic activity in the first quarter of the current fiscal year, but there are reasons to expect a muted economic impact as compared to the first wave, a finance ministry report said on Friday. Learning to operate with Covid-19 , as borne by international experience, provides a silver lining of economic resilience amidst the second wave, according to the ministry s monthly economic report.
ISSUE DATE: May 10, 2021
UPDATED: May 1, 2021 20:06 IST
MUMBAI HALTS: The road outside Chhatrapati Shivaji
Maharaj Terminus during the ongoing lockdown (Milind Shelte)
In his address to the nation on April 20, Prime Minister Narendra Modi urged states to think of lockdowns as a means of last resort. Within a week, though, faced with a runaway spiral in Covid cases, Maharashtra, Delhi, Gujarat and Karnataka were forced to do just that, while Punjab, Chhattisgarh, Rajasthan and Haryana had to impose night and weekend curfews.
Already reeling from the after-effects of the nationwide lockdown last year, Maharashtra was forced to announce an extension of its calibrated lockdown till May 15. It’s the largest state in terms of GSDP (gross state domestic product) and contributes 14.2 per cent of the national GVA (gross value added). In FY21, the state’s economy contracted 8 per cent in real terms and 5.6 per cent in nominal terms. Soumya Kanti Ghosh, chief economic advisor at State
SBI’s Business Activity Index dips to a new low
April 29, 2021
Lockdowns/ restrictions imposed in various States having significant impact on economic activity
State Bank of India’s Business Activity Index, which has been declining in April 2021, has now dipped to a new low of 75.7, the level it attained in August 2020.
According to the SBI’s economic research report ‘Ecowrap’, the index level, which is now 24.3 per cent down from-pre pandemic level, indicates that the disruption caused by increased lockdowns/restrictionsin different States is now having a significant impact on economic activity.
All the indicators, except for labour participation and electricity consumption, have declined significantly during April, hinting that labour market disruptions are still manageable unlike the first wave, the report said.