|
|
|
|
|
|
|
|
| Indian Economic Update
|
|
Trade deficit widens to a record high of USD 23.3billion in May as imports increase 56.14% to USD 60.62billion; merchandise exports increased by 15.46% YoY, ...to USD 37.29billion driven by petroleum products, electronic goods and readymade garments
Food Secretary The government asks PSUs to submit their proposals regarding strategic divestment and minority stake sales to the Department of Investment and Public Asset Management (DIPAM) through its administrative ministry
India’s GDP growth for FY22 came in at 8.7%, driven by investments and exports. Q4 GDP and GVA growth at 4.1% and 3.9%.Growth likely slowed down in the first quarter of the calendar year 2022,which was hit by the Omicron variantled third COVID-19 wave and the Russia-Ukraine war
Provisional estimates showed that the centre’s fiscal deficit for FY22 stood at INR 15.87trillion vs INR 15.9trillion. Fiscal deficit as a percentage of GDP came down to 6.7% against the revised estimate of 6.9%
The Union Government extended the Prime Minister's Employment Generation Programme to FY26 with a total outlay of INR 135.54billion, with the scheme generating employment opportunities for 4million people in 5 financial years
Government of India proposes a scheme worth INR 10billion to invite private companies to set up manufacturing zones for power and renewable energy equipment and extends the PLI scheme for specialty steel for another month till June 30
India’s fertiliser subsidy bill for the current fiscal year (FY23) could rise to INR 2.5trillion as prices of chemical nutrients and natural gas are expected to remain elevated
The size of RBI’sbalance sheet has increased by 8.5% during FY22, as per the annual report. The year FY22 ended with an overall surplus of INR 303billion as against the surplus of INR 991billion in the last year. It also flagged an inflation risk raising concerns about input price inflation and the possible pass-through of input prices to retail inflation with a lag
Addressing the 'Natural Allies in Development and Interdependence' conclave, FM Nirmala Sitharaman said that the Centre is implementing various rail, road and air connectivity projects worth INR 1.34trillion in the northeast.
|
|
|
|
|
|
|
| Global Update
|
|
OPEC+ agreed to raise production by a larger-than-expected 648k barrels a day for July and August. The decision came after the EU approved a partial ban on ... on Russian oil imports and after months of pressure by the US on Saudi Arabia.
The EU approved a sixth package of sanctions including a partial ban on Russian oil imports, which includes ban on purchase of crude oil, removal of bank’s from the SWIFT system and a ban on insurance for shipping oil
Federal Reserve Vice Chair LaelBrainard said expectations for the half-percentage-point increase in interest rates this month and the next were reasonable and saw no case for pausing the Central Bank’s tightening campaign afterward
ECB policy maker Visco said that the ECB should proceed gradually in raising interest rates and keep a flexible approach to prevent financing conditions from diverging across Euro zone countries
Russia has cut off gas to more European buyers, stepping up its use of energy as a weapon after buyers refused to pay in Rubles. Gazprom halted pipeline shipments to the Netherlands and Denmark this week and cut off a small contract supplying Germany
Federal Reserve Governor Christopher Waller said he wants to keep raising interest rates in half-percentage point steps until inflation is easing back toward the US Central Bank’s goal
European Council President Charles said that European Union leaders agreed to pursue a partial ban on Russian oil. The sanctions would forbid the purchase of crude oil and petroleum products from Russia delivered to member states by sea but include a temporary exemption for supply through pipelines
President Biden will hold a rare meeting with Powell in the Oval Office on Tuesday to discuss the state of the American and global economy, according to a White House statement
While the FOMC’s preferred measure of inflation—PCE moderated from 0.9% MoM in March to 0.2% MoM in April, real personal spending accelerated in both nominal (0.9% MoM) and real terms (0.7% MoM) in April, showing that consumer spending remains fairly robust
The drop in Covid-19 cases in Beijing and Shanghai has forced Chinese policymakers to ease lockdowns and restrictions that have been in place. At the same time, local authorities in Shanghai have offered tax rebates for companies and allowed all manufacturers to resume operations from June. The easing in restrictions in China has worked as the key catalyst to push Brent Crude prices above the USD 120/bbl mark
|
|
|
|
|
|
|
| Equity
|
|
Benchmark indices are likely to open higher, tracking positive Asian equity markets, which rallied after the US equity markets saw a rebound in the overnight session. ... Focus now shifts towards the non-farm payroll data for the US, which will provide further cues to the markets as the upbeat data may push the Fed to continue with the aggressive rate hike path.
During the week Sensex gained 1.61% to close at 55769.23 while Nifty advanced 1.41% to close at 16584.30
|
|
|
|
|
|
|
| Debt
|
|
Government bond prices are likely to open steady ahead of the weekly debt sale worth INR 320billion scheduled. Participants are expected...to remain cautious ahead of the MPC meet next week, where MPC is expected to raise interest rates. Prices may also take cues from overnight movement in UST and crude oil prices
10Y benchmark yield ended at 7.46% as compared to 7.35% of previous week.
|
|
|
|
|
|
|
| Oil
|
|
|
Crude prices rallied following the OPEC+ decision, which does little to change how tight the market remains. ... . Also providing support for crude was a bullish EIA crude oil inventory report. Oil is trading at USD 117.58/bbl.
|
|
|
|
|
|
|
| Gold
|
|
|
Gold is trading higher due to investors’ concern of higher inflation. Gold is trading at USD 1870.85/oz.
|
|
|
|
|
|
|
| Currency
|
|
The USD/INR pair is likely to open lower as risk-off sentiment due to equity rebound may support the bid for the local unit. However, ... elevated crude oil prices may dampen the sentiment. Any sharp movement is unlikely due to expected RBI interventions. The Indian Rupee depreciated against the US dollar in the previous trading session moving to the 77.60 level.
Source: ICICI Bank Research, Private Banking Investment Strategy Team, Bloomberg and CRISIL.
|
|
|
|
|
|
|
|
| |
| Sensex |
|
|
|
|
During the week Sensex gained 1.61% to close at 55769.23 while Nifty advanced 1.41% to close at 16584.30
|
|
|
|
|
| |
| Bond Yields |
|
|
|
|
10Y benchmark yield ended at 7.46% as compared to 7.35% of previous week.
|
|
|
|
|
|
|
|
|
Source: ICICI Bank Research, Private Banking Investment Strategy Team, Bloomberg and CRISIL.
Disclaimer:
The information set out herein has been prepared by ICICI Bank in good
faith and from sources deemed reliable. ICICI Bank does not provide any
assurance as regards the accuracy of such information. ICICI Bank does
not accept any responsibility for any errors whether caused by
negligence or otherwise or for any direct or indirect loss / claim/
damage caused to any person, arising out of or in relation to the use of
information communicated herein.
|
