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Indian Economic Update
India has climbed six places on World Bank‘s Logistic Performance Index (LPI) 2023, now ranking 38th among ...139 countries, owing to significant investments in both soft and hard infrastructure as well as in technology

The State of the Economy report released by RBI in the monthly bulletin of April 2023 noted that substantial disinflation has been achieved. However, inflation needs to be brought down to the target of 4%. It added that there is a need to evaluate the effects of monetary policy actions carried out so far on economic activity

Interest rate hikes could resume if fresh price shocks were significant enough to raise expected inflation above the Monetary Policy Committee's tolerance band of 2-6%, Ashima Goyal, a member of the rate-setting panel said in an interview

Finance Minister Ms. Nirmala Sitharaman said that seasonal supply side problems add to inflation and that they are being monitored continuously with efforts being made to bring down prices of essential commodities

According to the Monthly Economic Review by the Finance Ministry, India's aim of 6.5% real economic growth for this financial year faces increasing risks from El Nino, OPEC's surprise output cut and banking risks in some advanced economies. This could affect the favourable combination of growth and inflation outcomes currently estimated

Ministry of Power has asked states not to levy or impose tax or duty on generation of electricity, especially from hydro projects, it being illegal and exhorted them to withdraw any such levies promptly.

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Global Update
The US economy slowed from 2.6% QoQ SAAR (Seasonally Adjusted Annual Rate) in Q42022 to 1.1% in Q12023 reflecting ...primarily, a sharp fall in inventories that subtracted 2.26 percentage points from the GDP

The US House Republicans passed a bill to raise the government’s debt ceiling by USD 1.5 trillion that includes sweeping spending cuts over the next decade

ECB’s Chief Economist Philip Lane said that the current data is indicating a rate hike and that it would be inappropriate to leave our deposit rate at the current level of 3%

A local Japanese newspaper reported that the Bank of Japan is planning to review and inspect policies taken over the past decades.

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Equity
This week, benchmark equity indices opened higher amidst mixed Asian equities. Investors focus on BOJ’s policy meeting... and the US market ended mixed as banking fears outweighed big tech earnings. US GDP growth rate and core PCE were the key drivers for the market.

During the week Sensex gained 2.44% to close at 61112.44 while Nifty gained 2.50% to close at 18065.00

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Debt
Government bond prices opened higher as robust investor demand in the last auction on the back of aggressive cut-offs supported the ...sentiment. Prices turned negative when UST yields rose on the back of robust earnings from tech companies, helping investors look through weak economic data. India’s fiscal deficit and infrastructure output will be awaited to provide further cues.

The 10Y benchmark G-Sec was trading at a yield of 7.12% on 28 April, 2023 at 16:19 IST

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Oil
This week Brent traded in a lower range, weighed down by the prospect of further interest rate hikes that could hurt global economic growth... and future energy demands. Fears of a recession in the US which could in turn dent oil demand, set in following a string of weak economic data and corporate earnings. Oil prices have fallen even though US crude inventories have receded.

Brent was trading at $78.99 on 28 April, 2023 at 16:19 IST

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Gold
This week, Gold prices kept to a small range as traders hunkered down, ahead of hotly watched data on US economic growth and ...the Federal Reserve’s preferred inflation gauge. Although, a high safe-haven demand kept the yellow metal near key levels.

Gold was trading at $1984.22 Per Ounce on 28 April, 2023 at 16:19 IST

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Currency
The USD/INR pair opened flat with a downside bias as the greenback traded flat. The US durable goods order which came stronger ...than expected, was offset by banking sector jitters which have caused the DXY to remain flat. Falling oil prices also supported the INR.

USD/INR was trading at 81.83 on 28 April, 2023 at 16:19 IST

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Sensex
61112.44
2.44%
During the week Sensex gained 2.44% to close at 61112.44 while Nifty gained 2.50% to close at 18065.00
 
Bond Yields
7.12%

The 10Y benchmark G-Sec was trading at a yield of 7.12% on 28 April, 2023 at 16:19 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.