สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 13 กุมภาพันธ์ 2557

Retail inflation eases to 2 yr-low

Consumer Price Index-based inflation, a widely tracked rate after a Reserve Bank of India (RBI) panel recommended targeting it, has declined for a second month in a row. The rate of price rise fell to a two-year low of 8.79 per cent in January from 9.87 per cent in the previous month. The inflation had reached a record 11.16 per cent in November and was blamed for the Congress’ rout in the recent assembly elections. Inflation in both urban’s and rural parts on a downswing. While it fell to 8.09 per cent in January from 9.11 per cent in December in urban India, rural areas saw the rate of rise coming down to 9.43 per cent from 10.49 per cent. Food items, carrying the highest weight of over 45 per cent, saw inflation easing to 9.90 per cent from 12.16 per cent in December. However, fruit prices rose 15.6 per cent as compared to 14.64 per cent in December. Protein-rich items such as eggs, meat and fish became dearer by 11.69 per cent in January. The rate of inflation in this segment was slightly higher at 12.64 per cent in December. Pulses were costlier by 2.59 per cent, cereals by 11.42 per cent and milk products by 9.82 per cent in January. Clothing, bedding and footwear saw prices rising to 9.18 per cent against 9.25 per cent in December. Similarly prices of fuels increased 6.54 per cent  against 6.98 per cent in the previous month. The Wholesale Price Index-based inflation was much lower at 6.16 per cent in December. The data for January will come on Friday. However, RBI has indicated shifting its stance of monetary policy towards targeting retail inflation. The central bank had said it might exceed eight per cent by March-end and efforts would continue to bring it down. A committee headed by Reserve Bank of India (RBI)’s Deputy Governor Urjit Patel had, last week, recommended the central bank aim to bring down retail inflation to eight per cent by January 2015 and to six per cent by January 2016.Though the overall retail rate of  price rise decreased in January, core inflation (relating to non-food, non-fuel items) picked up slightly for a third straight month, to 8.11 per cent from  8.09 per cent  in December. Core inflation is expected to be a key determinant of RBI’s monetary stance generally. Even as there are demands for a rate cut by industry and  business chambers as industrial production contracted for a third straight month, economists did not think RBI will do so in its April  policy.

(Source: Business Standard)

Industry output shrinks for 3rd straight month

Dragged down by manufacturing, particularly of consumer durables, industrial production shrank by 0.6 per cent in December 2013 as against 1.3 per cent in November, the third straight month of contraction, official data showed on Wednesday.The fact that factory production did not grow despite a low base of a 0.6 per cent fall in December 2012 presented a gloomy picture of the industrial scenario.Manufacturing, which has a weight of over 75 per cent in the Index of Industrial Production (IIP), continued to decline in December 2013. Its output decreased 1.6 per cent in the month as against a 2.6 per cent fall in November. Manufacturing was down 0.8 per cent in December 2012. Mining production managed to grow for the second month in succession but its expansion was small at 0.4 per cent as against a 1.72 per cent rise in November. It had seen a 3.1 per cent fall in December 2012. Electricity was the only saving grace in the IIP data released on Wednesday. Power generation saw a 7.5 per cent rise as against 6.30 per cent a month earlier. It had increased 5.2 per cent in December the previous year. Experts say the IIP reading is in line with the advance estimates of Gross Domestic Product (GDP) released by the Central Statistics Office a few days back. The difference is that GDP data take the value of these production numbers into account. Consumer durables witnessed a contraction for the 13th straight month as output fell 16.2 per cent in December as against a fall of 8.1 per cent a year ago. On the other hand, non-durables rose 1.6 per cent. As a result, consumer goods output went down 5.3 per cent as against a decline of 3.6 per cent a year ago.

(Source: Business Standard)

Norms for trade receivable exchange soon: Raghuram Rajan

The Reserve Bank will soon be coming out with a set of norms for a dedicated exchange for trade receivables that can help smaller businesses tide over liquidity issues, Governor Raghuram Rajan today said. Rajan said the big businesses squeeze the smaller ones when it comes to payments, creating difficulties for the latter. Therefore, if the small business owner is able to raise money against the receivable, it will be much better for the business, he said, adding an exchange can help bring down the cost of such transactions through automation. Technology has a big role to play for this to happen by providing the right kind of solutions, the RBI chief said. Meanwhile, on the key agenda of financial inclusion, Rajan said the Reserve Bank has made it possible for a person not having a bank account to receive remittances through the use of ATM and simple mobile phones.

(Source: Economic Times)

Exports rose while trade deficit plummeted in January 2014: Report

Exports rose at a modest pace for the third month running, but the sharp drop in imports led by gold helped bring the trade deficit below the $10-billion mark in January, which will further improve the current account deficit. Exports rose 3.79% to $26.75 billion in January from a year ago, moderately ahead of the 3.5% rise recorded in December, data released on Tuesday showed. Imports dropped at the fastest pace in four months in January, declining 18.07% to $36.6 billion because of a 77% plunge in bullion imports, helping narrow the trade deficit to $9.92 billion in January from $10.14 billion in December. India's currency depreciated sharply last year amid concerns over funding the current account deficit after the US Federal Reserve announced its intention to wind down its $85 billion a month bond purchases. The current account deficit had swelled to a record 4.8% of GDP in the year ended March 2013. The US Fed has already brought down bond purchases by $20 billion in two tranches but the Indian rupee has held steady because of the much-improved CAD after government took measures to discourage gold imports while low economic growth kept other imports depressed. The rupee closed 21 paise up on Tuesday, registering its best daily gain in two weeks to end at 62.22 to the dollar.

(Source: Economic Times)

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