NasNY
Chief Minister (5k+ posts)
India Stocks Sink: Economic Troubles & Pakistan Scuffles
India's economic growth is struggling, its indications that the budget deficit won't shrink sent bond yields higher and equities lower.
India is digging out of its deepest economic slump in three years, and is seeking more private investment to help boost growth.
Private consumption decelerated because of demonetization -- the removal and slow replacement of 85% of the country's rupees last November.
Then this year, India finally adopted a Goods and Services Tax (GST). Each has been heralded as a necessary difficulty on the road to economic progress. But finance Minister Arun Jaitley said in a speech this week that private investment from Indian companies is needed as the government seeks a balance between spending and fiscal prudence. He also said the banking system must get healthier to support that investment, Bloomberg reports, adding:
Also in the news: India called Pakistan "terroristan," after the Pakistani prime minister accused India of brutal suppression in Kashmir, the Economic Times reported.
Source
India's economic growth is struggling, its indications that the budget deficit won't shrink sent bond yields higher and equities lower.
India is digging out of its deepest economic slump in three years, and is seeking more private investment to help boost growth.
Private consumption decelerated because of demonetization -- the removal and slow replacement of 85% of the country's rupees last November.
Then this year, India finally adopted a Goods and Services Tax (GST). Each has been heralded as a necessary difficulty on the road to economic progress. But finance Minister Arun Jaitley said in a speech this week that private investment from Indian companies is needed as the government seeks a balance between spending and fiscal prudence. He also said the banking system must get healthier to support that investment, Bloomberg reports, adding:
"... With elections a little more than a year away, pressure has been building on Prime Minister Narendra Modi to spur investment and create jobs for the swelling workforce.
The problem is that U.S. tightening and rising global oil prices make it tougher for India to spend more. India aims to shrink its budget deficit to 3.2 percent of gross domestic product in the year through March 2018 from 3.5 percent the previous year. Jaitley declined to provide details on the government’s plans to spur growth. Indian bond yields jumped and the rupee fell on Thursday on concern that the government will forfeit its goal to shrink Asia’s widest budget deficit. ..."
On Friday, India equity ETFs tumbled. Smallcaps tumbled, and the Columbia India Small Cap exchange-traded fund (SCIN) was off by more than 3%, while the iPath MSCI India Index exchange-traded note (INP) fell nearly 2%. The WisdomTree India Earnigns Fund (EPI) was off by 1.8%, and the iShares MSCI India ETF (INDA) was down 1.5%.The problem is that U.S. tightening and rising global oil prices make it tougher for India to spend more. India aims to shrink its budget deficit to 3.2 percent of gross domestic product in the year through March 2018 from 3.5 percent the previous year. Jaitley declined to provide details on the government’s plans to spur growth. Indian bond yields jumped and the rupee fell on Thursday on concern that the government will forfeit its goal to shrink Asia’s widest budget deficit. ..."
Also in the news: India called Pakistan "terroristan," after the Pakistani prime minister accused India of brutal suppression in Kashmir, the Economic Times reported.
Source
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