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☆ India's Nov services activity growth hit 3-mth high, high inflation a concern
▼ + stars: | 2022-12-05 | by ( Indradip Ghosh | ) www.reuters.com time to read: +2 min

The S&P Global India services purchasing managers' index (INPMIS=ECI) rose to 56.4 in November from 55.1 in October, beating the 55.4 estimate in a Reuters poll. It remained above the 50-mark separating growth from contraction for a 16th straight month, its longest stretch of expansion since October 2016. However, growth is widely expected to slow in the coming quarters as high-interest rates hamper economic activity. "Evidence of stubborn inflation may prompt further hikes to the policy rate at a time when global economic challenges could negatively impact on India's growth," added De Lima. Stronger expansion in services activity alongside better-than-expected manufacturing growth boosted the composite index to a three-month high of 56.7 in November from 55.5 in October.

The findings highlight how the housing market, one of the biggest employers in a country of around 1.4 billion people, is likely to remain a stable contributor to growth in Asia's third-largest economy going forward. Relatively modest interest rate risk partly explains why all but one of 10 analysts who answered an additional question said the chances of a significant slowdown in the housing market over the coming year were low. Nine of 11 respondents said either an economic slowdown or rising rates would be the biggest challenge for first-time homebuyers. "While India ... has been quite resilient amidst global disturbances, the chances of a slowdown in India cannot be ruled out," said Anuj Puri, chairman of ANAROCK Property Consultants. (For other stories from the Reuters quarterly housing market polls:)Reporting by Milounee Purohit and Indradip Ghosh in Bengaluru Polling by Maneesh Kumar Editing by Hari Kishan, Ross Finley and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.

If U.S. financial conditions continue to ease and implied market volatility remains well-anchored, bulls will stay on the front foot. On the Asian policy front, further evidence that the burst of 'jumbo' hikes is over will also support risk appetite. The fiscal policy focus this week will be on China, with the Communist Party's Politburo meeting early this month to lay out the government's strategy and guidelines for the year ahead. Analysts at Goldman Sachs expect policymakers to reiterate a 'supportive' stance in light of weak economic activity recently. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

MUMBAI, Dec 1 (Reuters) - A month into India's pilot project for using an official digital rupee for inter-bank and institutional transactions, stakeholders are seeing no benefits, several bankers said. But in the initial trial banks have been using it for settlements with each other - with no particular advantage, according to bankers. Another issue is that, since e-rupee transactions do not wholly replace those using established procedures, they add to banks' accounting work. It would also offer a safer means of digital payment in retail use, the RBI said. UPI, an instant real-time consumer payments system that lets users transfer money between banks without disclosing account details, has been a factor in India's soaring digital payment volume.

☆ India’s Central Bank to Launch Retail Pilot of Digital Rupee
▼ + stars: | 2022-11-30 | by ( Shefali Anand | ) www.wsj.com time to read: 1 min

India’s central bank will launch its first pilot of a digital rupee for individual users on Thursday, putting it ahead of many major economies in the journey toward a sovereign virtual currency. The Reserve Bank of India has said a digital rupee could provide Indians a safe alternative to risky private digital currencies.

☆ India stocks to rise 9% by end-2023 despite slowing economy - Reuters poll
▼ + stars: | 2022-11-30 | by ( Indradip Ghosh | ) www.reuters.com time to read: +3 min

Summary poll dataBENGALURU, Nov 30 (Reuters) - India's stock market, which rallied to a record high this week, is forecast to rise another 9% by the end of 2023 despite widespread expectations of a gradual slowdown in the economy, according to market experts polled by Reuters. The benchmark BSE Sensex Index (.BSESN) touched an all-time record high of 62,887.40 on Tuesday, surging more than 23% from this year's low of 50,921.22 hit on June 17. The Sensex was then forecast to rise to 68,000 by end-2023, for a total gain of around 9%. The Nifty 50 (.NSEI), which has also hit a record high, was forecast to gain 4.7% from Tuesday's close of 18,618.05 to 19,500 by mid-2023, and reach 20,500 by end-2023. But by most measures, the Indian market looks overbought.

NEW DELHI, Nov 30 (Reuters) - India posted annual economic growth of 6.3% in its July-September quarter, less than half the 13.5% growth in the previous three months as distortions caused by COVID-19 lockdowns faded in Asia's third-largest economy. Economists warned, however, that growth momentum may ease in the December quarter due to higher interest rates and slowing exports. "Even as domestic growth drivers on services side continue to remain robust, weakening global demand amid tightening financial conditions remains the key risk for growth outlook for India," said Garima Kapoor, economist at Elara Capital. Slowing global growth has also started to hurt exports, which fell 17% over a year ago in October. "Services on the supply side and investments in the demand side would continue to be the main drivers of growth," said Sujan Hazra, chief economist at Anand Rathi.

☆ India's economy likely slowed to annual 6.2% in July-Sept: Reuters poll
▼ + stars: | 2022-11-28 | by ( Indradip Ghosh | ) www.reuters.com time to read: +2 min

Summary Data due at 1200 GMT on Wednesday, Nov. 30BENGALURU, Nov 28 (Reuters) - The Indian economy likely returned to a more normal 6.2% annual growth rate in July-September after double-digit expansion in the previous quarter, but weaker exports and investment will curb future activity, a Reuters poll showed. In April-June, Asia's third-largest economy showed explosive growth of 13.5% from a year earlier thanks mainly to the corresponding period in 2021 having been depressed by pandemic-control restrictions. The 6.2% annual growth forecast for latest quarter in a Nov. 22-28 Reuters poll of 43 economists was a tad lower than the RBI's 6.3% view. Meanwhile, the RBI raised its key policy interest rate to 5.9% from 4.0% in May and is widely expected to add another 60 basis points by the end of March. "Between December and February, the headwinds to growth may become more evident," said Deutsche Bank's Das.

☆ Indian banks' loan growth to accelerate despite higher interest rates -Fitch
▼ + stars: | 2022-11-28 | by ( ) www.reuters.com time to read: +2 min

BENGALURU, Nov 28 (Reuters) - Loan growth at Indian banks will accelerate to 13% in this fiscal year despite the RBI raising interest rates, as economic activity picks up after a pandemic led lull, Fitch Ratings said on Monday. read moreStrong loan growth will, however, put pressure on core equity tier 1 ratios if credit growth exceed expectations, limiting buffers to absorb potential future losses, the ratings agency said. Deposit growth is seen at 11% this year and the next, slower than loan growth. Increased deposit rates may put some pressure on margins, but lower credit costs should offset pressure on profitability, Fitch said, adding that near-term asset quality risks appeared contained. "Deposits' large role in banks' funding mix are likely to remain a credit strength for Indian banks, despite some normalisation in household savings after being boosted during the pandemic," the note said.

☆ Indian shares set to open lower on China COVID woes
▼ + stars: | 2022-11-28 | by ( ) www.reuters.com time to read: +2 min

Foreign institutional investors bought a net 3.69 billion rupees ($45.17 million) worth of equities on Friday, while domestic investors sold a net 2.96 billion rupees ($36.24 million) worth of shares, as per provisional NSE data. ** Larsen & Toubro Financial Holdings (LTFH.NS): Completed divestment of its mutual fund business to HSBC Asset Management (India) and received 34.84 billion rupees. The company also realised surplus cash balance of 7.65 billion rupees in L&T Investment Management. ** VA Tech Wabag (VATE.NS): Signed an agreement with Asian Development Bank towards raising 2 billion rupees through unlisted non-convertible debentures. ($1 = 81.6850 Indian rupees)Reporting by Bharath Rajeswaran in Bengaluru; editing by Uttaresh.VOur Standards: The Thomson Reuters Trust Principles.

The rupee ended unchanged at 81.6850 per U.S. dollar last week. "Markets are sensing a softening of approach from the U.S. Federal Reserve and that's giving legs to risk assets. The benchmark 10-year bond yield finished flat at 7.3012% last week. It is expected to stay within a 7.25%-7.33% band this week, with a break below 7.25% considered highly unlikely, the trader said. Many Asian countries are scheduled to release manufacturing data, with China's factory activity data due Wednesday.

☆ India's growth to slow in 2023 on fading reopening impact-Goldman Sachs
▼ + stars: | 2022-11-21 | by ( ) www.reuters.com time to read: +2 min

MUMBAI, Nov 21 (Reuters) - Goldman Sachs expects India's economic growth to slow to 5.9% next year, from an estimated 6.9% growth in 2022, as the boost from the post-COVID reopening fades and monetary tightening weighs on domestic demand. "In the second half, we expect growth to re-accelerate as global growth recovers, the net export drag declines, and the investment cycle picks up," Sengupta said. The Reserve Bank of India (RBI), last week, pegged the domestic growth rate at 7% for 2022-23. Goldman Sachs expects headline inflation to drop to 6.1% in 2023, from 6.8% in 2022, saying government intervention was likely to cap food prices and that core goods inflation had probably peaked. "But upside risks to services inflation are likely to keep core inflation sticky around 6% year-on-year," Sengupta added.

☆ India's forex reserves rise at fastest pace since August 2021
▼ + stars: | 2022-11-18 | by ( ) www.reuters.com time to read: +1 min

MUMBAI, Nov 18 (Reuters) - India's foreign exchange reserves (INFXR=ECI) rose to $544.72 billion in the week through Nov. 11, marking their biggest weekly jump in more than a year, the Reserve Bank of India's (RBI) weekly statistical supplement showed on Friday. The country's reserves were at $529.99 billion by Nov. 4. In the week ended Nov. 11, softer-than-expected U.S. inflation data helped the rupee mark its best weekly performance in about four years and strengthened it to the 80-per-dollar handle for the first time since mid-September. For the current week, the local currency gave back some of those gains to end down 1.1% at 81.6850 per dollar. Reporting by Anushka Trivedi in Mumbai; Editing by Anil D'SilvaOur Standards: The Thomson Reuters Trust Principles.

☆ India watchdog ire cools foreign banks’ ambitions
▼ + stars: | 2022-11-16 | by ( Shritama Bose | ) www.reuters.com time to read: +4 min

India is bristling at the idea of foreign regulators inspecting its entities which settle trades in government bonds, foreign exchange and more. The higher costs will make the services of European Union and British banks in India uncompetitive, prompting clients to switch to other foreign or domestic banks. Bosses of smaller foreign banks already complain in private that their returns in India are lousy. The Reserve Bank of India, for example, could in theory strike a deal that sets boundaries on on-site visits, as Singapore has done. The Indian regulators include Reserve Bank of India, Securities and Exchange Board of India and International Financial Services Centres Authority, ESMA said.

☆ India's Oct retail inflation eases, spurs smaller rate hike views
▼ + stars: | 2022-11-14 | by ( Manoj Kumar | ) www.reuters.com time to read: +4 min

The annual retail inflation was 7.41% in September. Food prices, which account for nearly 40% of the CPI basket, rose 7.01% in October, compared with 8.60% in September. Month-on-month retail inflation rose 0.80% in October, compared with the previous month, while retail food inflation rose 1.08% — reflecting inflationary pressures in the economy. Last week, ratings agency Moody's revised down India's GDP growth forecast to 7% in 2022, from earlier estimate of 7.7%, and to 4.8% in 2023. Excluding the volatile food and energy components, the core inflation rose 5.9% to 6.3% last month, according to three economists' estimates, compared to 6.07% to 6.1% in September.

☆ Indian companies turn to exotic options to manage fx costs, risks
▼ + stars: | 2022-11-09 | by ( Nimesh Vora | ) www.reuters.com time to read: +3 min

MUMBAI, Nov 9 (Reuters) - A few large Indian companies are returning to exotic currency options to deal with the rupee's volatility as they look to manage hedging costs and foreign exchange risks. These options provide companies increased flexibility to manage their currency risks. Companies are specifically turning to barrier options, a class of knock-out or knock-in options that are exercisable or expire worthless depending on whether a particular level on the underlying asset is reached. When used with proper risk assessment, barrier options help to manage the premium cost, a trader with a large private sector bank said. Meanwhile, foreign exchange consultants warned against large-scale use of exotic options.

☆ 'Comfort zone' for inflation in India is between 4% and 6%, says former central bank chief
▼ + stars: | 2022-11-08 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via Email'Comfort zone' for inflation in India is between 4% and 6%, says former central bank chiefC. Rangarajan, former governor of the Reserve Bank of India, discusses the factors that have contributed to the rise in inflation, such as the sudden rise in petroleum prices after the Russia-Ukraine war broke out.

☆ India should allow gradual rupee weakening, use fx reserves 'judiciously' - govt adviser
▼ + stars: | 2022-11-07 | by ( Shivangi Acharya | ) www.reuters.com time to read: +2 min

NEW DELHI, Nov 7 (Reuters) - India's central bank should allow rupee to depreciate gradually and use foreign exchange reserves judiciously, the government's chief economic adviser V. Anantha Nageswaran on Monday. Nageswaran comment on the rupee and foreign exchange reserves is the first official government comment since concerns about dwindling currency reserves emerged earlier this year. India's foreign currency reserves have fallen from a peak of $642 billion to $531 billion partly due to dollar sales to support the rupee. “We should in the short-run allow the rupee to depreciate gradually and we should use forex exchange reserves judiciously,” Nageswaran said at an online event. “We should augment foreign exchange reserves and that will help with any contingencies,” he added.

☆ INDIA RUPEE Rupee eases as Fed sticks to hawkish tone
▼ + stars: | 2022-11-03 | by ( Anushka Trivedi | ) www.reuters.com time to read: +1 min

The rupee eased to 82.85 per dollar, against its previous close of 82.78. The currency had consolidated around 82.70 all of this week ahead of the U.S. central bank meeting. The Fed raised its benchmark funds rate by 75 basis points (bps) to 3.75%-4% as widely expected overnight. "This gives some breather to India as the country's central bank may not have to hike as aggressively." The Reserve Bank of India meets later in the day for a special meeting, most likely to discuss its first ever inflation target miss.

☆ INDIA STOCKS Indian shares set for lower opening as Fed keeps hawkish stance
▼ + stars: | 2022-11-03 | by ( ) www.reuters.com time to read: +3 min

India's NSE stock futures, listed on the Singapore exchange , were 0.94% lower as of 0211 GMT. The Federal Reserve raised interest rates by 75 basis points on Wednesday as widely expected and said its battle against inflation will require borrowing costs to rise further. Meanwhile, foreign institutional investors bought a net 14.36 billion Indian rupees ($173.61 million) worth of equities on Wednesday, while domestic investors sold 13.78 billion rupees of shares, as per provisional data available with the National Stock Exchange. ** Mahindra and Mahindra Financial Services Ltd (MMFS.NS) reported September-quarter profit of 4.48 billion rupees, a 56.2% year-on-year decline. ($1 = 82.7120 Indian rupees)Reporting by Rama Venkat in Bengaluru;Editing by Dhanya Ann ThoppilOur Standards: The Thomson Reuters Trust Principles.

☆ INDIA STOCKS Indian shares set for muted opening; Fed meet in focus
▼ + stars: | 2022-11-02 | by ( ) www.reuters.com time to read: +3 min

** Adani Ports and Special Economic Zone APSE.NS, India's largest private operator of ports, reported a 69% surge in quarterly profit on Tuesday, driven by strong cargo volumes. ** Sun Pharmaceutical Industries Ltd (SUN.NS) on Tuesday reported a surprise 10.5% rise in second quarter profit led by a surge in sales of specialty drugs. ** IT services provider Tech Mahindra (TEML.NS)reported better-than-expected quarterly profit and revenue on Tuesday, helped by strong demand and the company also declared a special dividend. ** Kansai Nerolac Paints Ltd (KANE.NS)reported a weaker-than-expected rise in second quarter profit on Tuesday, hit by higher input costs and a demand squeeze due to unseasonal rains. ** Voltas Ltd (VOLT.NS)posted a loss for the second quarter on Tuesday, dented by higher expenses and a one-off expense related to a contract termination.

☆ INDIA STOCKS Indian shares seen opening higher, Fed in focus
▼ + stars: | 2022-11-01 | by ( ) www.reuters.com time to read: +3 min

BENGALURU, Nov 1 (Reuters) - Indian shares may kick off November trading on a higher note on Tuesday, after rising for three straight sessions, tracking gains in broader Asia as investors turn focus to the U.S. Federal Reserve policy meeting this week. India's NSE stock futures, listed on the Singapore exchange , were 0.61% higher as of 0203 GMT. Investors this week will be looking for the outcome of the Fed policy meeting and the outlook on future rate hikes path. The Fed is widely expected to raise interest rates by 75 basis points on Wednesday at the conclusion of its two-day policy meeting. ($1 = 82.7910 Indian rupees)Reporting by Rama Venkat in Bengaluru; Editing by Dhanya Ann ThoppilOur Standards: The Thomson Reuters Trust Principles.

☆ India cenbank to start pilot of digital rupee on Nov 1
▼ + stars: | 2022-10-31 | by ( Reuters Staff | ) www.reuters.com time to read: +1 min

FILE PHOTO: A man walks behind the Reserve Bank of India (RBI) logo inside its headquarters in Mumbai, India, April 8, 2022. REUTERS/Francis MascarenhasBENGALURU (Reuters) - The Reserve Bank of India (RBI) will launch the pilot for a central-bank-backed digital rupee for the wholesale segment on Nov. 1, it said on Monday, identifying nine banks, including top lender State Bank of India, to participate in the project. Settlements in central bank digital currency would reduce transaction costs, the RBI added. Besides SBI, the pilot will include Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank and HSBC, the RBI said. The central bank’s plans for a currency in digital form comes amid its staunch opposition of cryptocurrencies.

☆ Indian rupee marks biggest monthly losing streak since 1985
▼ + stars: | 2022-10-31 | by ( ) www.reuters.com time to read: +2 min

MUMBAI, Oct 31 (Reuters) - The Indian rupee has declined in each of the ten months this year to notch its biggest losing streak in almost four decades as the U.S. Federal Reserve's hawkish stance on monetary policy catapulted the dollar to two-decade highs. The dollar index is up 16% this year, having scaled 114.8-levels last month to trade near its 2002 peak. The Indian rupee fell 1.8% against the dollar in October, taking its slide for the year to nearly 11%. It could come under pressure in case Fed indicates aggressive tightening path in the future," HDFC Bank economists wrote in a note. Reporting by Anushka Trivedi in Mumbai; Editing by Savio D'SouzaOur Standards: The Thomson Reuters Trust Principles.

☆ INDIA STOCKS Indian shares seen opening higher to track Asia gains
▼ + stars: | 2022-10-31 | by ( ) www.reuters.com time to read: +3 min

BENGALURU, Oct 31 (Reuters) - Indian shares may open higher on Monday, after rising for two consecutive weeks, tracking gains in broader Asia and a fall in oil prices. India's NSE stock futures, listed on the Singapore exchange , were 0.92% higher as of 0242 GMT. The MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was up 0.8%. Stocks to watch:** Sugar stocks after India, the world's biggest sugar producer, extended restrictions for export by one year through October 2023, the government said in a notification late on Friday. ($1 = 82.2610 Indian rupees)Reporting by Rama Venkat in Bengaluru;Editing by Dhanya Ann ThoppilOur Standards: The Thomson Reuters Trust Principles.

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