oppn parties Turbulence Ahead For The Economy

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News Snippets

  • The Indian envoy in Bangladesh was summoned by the country's government over the breach in the Bangladesh mission in Agartala
  • Bank account to soon have 4 nominees each
  • TMC and SP stayed away from the INDIA bloc protest over the Adani issue in the Lok Sabha
  • Delhi HC stops the police from arresting Nadeem Khan over a viral video which the police claimed promoted 'enmity'. Court says 'India's harmony not so fragile'
  • Trafiksol asked to refund IPO money by Sebi on account of alleged fraud
  • Re goes down to 84.76 against the USD but ends flat after RBI intervenes
  • Sin goods like tobacco, cigarettes and soft drinks likely to face 35% GST in the post-compensation cess era
  • Bank credit growth slows to 11% (20.6% last year) with retail oans also showing a slowdown
  • Stock markets continue their winning streak on Tuesday: Sensex jumps 597 points to 80845 and Nifty gains 181 points to 24457
  • Asian junior hockey: Defending champions India enter the finals by beating Malaysia 3-1, to play Pakistan for the title
  • Chess World title match: Ding Liren salvages a sraw in the 7th game which he almost lost
  • Experts speculate whether Ding Liren wants the world title match against D Gukesh to go into tie-break after he let off Gukesh easily in the 5th game
  • Tata Memorial Hospital and AIIMS have severely criticized former cricketer and Congress leader Navjot Singh Sidhu for claiming that his wife fought back cancer with home remedies like haldi, garlic and neem. The hospitals warned the public for not going for such unproven remedies and not delaying treatment as it could prove fatal
  • 3 persons died and scores of policemen wer injured when a survey of a mosque in Sambhal near Bareilly in UP turned violent
  • Bangladesh to review power pacts with Indian companies, including those of the Adani group
D Gukesh is the new chess world champion at 18, the first teen to wear the crown. Capitalizes on an error by Ding Liren to snatch the crown by winning the final game g
oppn parties
Turbulence Ahead For The Economy

By Linus Garg
First publised on 2022-05-13 02:08:30

About the Author

Sunil Garodia Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.

 After four days of volatile trading which resulted in losses for investors, the stock markets crashed on Thursday. Sensex tumbled by 1158 points to 52930 and Nifty went down by 359 points to 15808. Investors were jittery ahead of the announcement of the CPI data and their worst fears were confirmed when the NSO reported that inflation, as measured by the consumer price index (CPI) stood at 7.8% in April, the highest in eight years.

Food and fuels prices are fuelling the inflation which, according to the Finance Ministry, is likely to stay elevated in FY22-23. The ministry said that timely action by the government and the RBI will reduce the duration of inflation. It also said that India was better placed than most nations to tide over the global economic stress and record steady growth.

During the trading hours in Indian stock markets, the US inflation figure for April was put out. It stood at 8.3% which was lower than March but still high enough to spook the market which now expects another stiff rate hike by the US Fed. Such a hike will result in another flight of funds from the Indian stock markets as FIIs will withdraw funds.
The day was also bad for the Indian rupee, which hit an all-time low of Rs 77.63 per dollar and later settled at Rs 77.5025. A falling rupee will add to inflation as fuel costs and prices of imported inputs for industry will increase leading to passing on of the costs to the consumer.

Indian economy is now entering a very turbulent phase. The cost-push inflation, along with rate hikes by the RBI and subdued consumer demand makes the picture hazy for companies. The Centre and the states should seriously think of reducing taxes on fuel as an effective short term measure to keep prices in control.  

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