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Indian Economic Update
The Monetary Policy Committee (MPC) voted unanimously to keep Repo Rate unchanged at 6.5% and retained the stance of ...‘withdrawal of accommodation’ with 5:1 vote. Inflation and growth forecast for the year were unchanged.

S&P Global India Services PMI rose at a faster pace to 61.0 in September (vs 60.1 in August), as business activity and new work intakes rose to the highest in almost 13 years.

The Indian economy is projected to grow at 6.3% YoY in the current financial year aided by investment and domestic demand, according to a World Bank report. It added that India continues to show resilience against the backdrop of a challenging global environment and inflation is expected to decrease as food prices normalise.

According to Finance Minister Nirmala Sitharaman, the inclusion of Indian bonds in J P Morgan's widely tracked emerging market debt index could bring USD 23 billion worth inflows into the country.

The Indian government raised the subsidy provided to women, who got free cooking gas connections under the Prime Minister Ujjwala Yojana (PMUY), to Rs 300 per cylinder, a respite in the times of high global fuel prices. All PMUY beneficiaries are eligible for the targeted subsidy.

Gross GST collection rose 10% to over Rs 1.62 trillion in September, crossing the Rs 1.6 trillion mark for the fourth time during the current financial year.

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Global Update
US job openings unexpectedly increased in August to 9.61 million from a revised 8.92 million in July....

The J P Morgan Global Services PMI Business Activity Index fell to an eight-month low of 50.8 in September against a previous reading of 51.1 in August. The latest data painted a generally lacklustre image for the sector, with both new and outstanding business declining and another modest round of job creation.

An OPEC+ ministerial panel that met on Wednesday made no changes to the group's oil output policy, after Saudi Arabia and Russia said they would keep voluntary supply cuts in place to support the market.

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Equity
The benchmark equity indices traded higher following the Asian market after USD eased and UST yields retreated from multi-year ...highs. Investors took cues from economic data with all eyes on the RBI MPC. Indices turned positive after a rate pause.

During the week Sensex inclined 0.25% to close at 65995.63 while Nifty gained 0.08% to close at 19653.50

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Debt
During the week, government bond yields traded in a narrow range after UST inched down as investors remained cautious ahead ...of US jobs report. Indian Government Bond yields reacted sharply after the MPC meeting with RBI, which maintained the status quo. Participants entered Rs 300 billion auction where supply pressure should continue at the longer end of the yield curve.

The 10Y benchmark G-Sec was trading at a yield of 7.34% on 06 Oct, 2023 at 15:45 IST

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Oil
Oil prices witnessed a significant drop caused by an extremely weak US fuel demand hitting a 23-year low for this time of the year at ... 8.3 million bpd as reported by the Energy Information Administration. On the supply side, OPEC+ made no changes to its output policy and maintained previously announced production cuts and Russia may lift its diesel ban. Investors remain cautious about growing economic growth concerns.

Brent was trading at $84.71 on 06 Oct, 2023 at 15:45 IST

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Gold
Gold prices traded lower during the week, falling to their lowest in seven months amid pressures of strong dollar and higher treasury ...yields. Prices started trading higher after it rebounded from seven-month lows, as the dollar index and treasury yields pulled back on the weaker-than-anticipated US job data. ISM services PMI revealed a slower but strong growth in September and factory orders rose way more than expected in August.

Gold was trading at $1846.65 Per Ounce on 06 Oct, 2023 at 15:45 IST

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Currency
The USD/INR pair traded in sync with the global USD trend and US yields. However, persistent intervention by RBI will likely continue to... limit any sharp movement in the pair.

USD/INR was trading at 83.11 on 06 Oct, 2023 at 15:45 IST

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Sensex
65995.63
0.25%
During the week Sensex inclined 0.25% to close at 65995.63 while Nifty gained 0.08% to close at 19653.50
 
Bond Yields
7.34%

The 10Y benchmark G-Sec was trading at a yield of 7.34% on 06 Oct, 2023 at 15:45 IST
 
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.