All macroeconomic indicators so far project a sombre picture for the economy.
Q4 GDP: Where will India be when this dreadful year finally ends? Today's numbers will show the first signs
The nationwide lockdown announced from March 25 brought the entire economy to a standstill .
"A rate cut will not reduce the rate of infection — it won't fix a broken supply chain," Powell said yesterday after the Fed cut rates by 50-bps. SBI MF CIO Navneet Munot corroborates: "While the US Fed has cut rates and other central banks have shown a strong resolve to act, my sense is that monetary policy has almost run its course."
The government has been intervening, at regular intervals, to pump prime the economy. Finance minister Nirmala Sitharaman announced new measures to boost economy and rolled back those which soured investor sentiment. The economy, which hit a trough in the second quarter, is expected to see some revival in the second half of this fiscal.
A number of experts have revised their fiscal deficit target for current fiscal. Fitch has raised the fiscal deficit target to 3.6 per cent for FY20. The data released by the Controller General of Accounts showed that the government had reached 115 per cent of the target for the full year in the first eight months of the current fiscal.
The numbers are critical for India as it powers ahead to reach its goal of $5 trillion GDP.
The issue of lack of monetary transmission hasn't cropped up suddenly and is something that has been a matter of concern for the RBI in ensuring the pass-through of its policy decisions. The matter snowballed in the last few months after the RBI observed that the effects of its rate cuts are not being felt in terms of interest rates coming down.
Going by what the indicators are showing so far, third quarter doesn't hold any hopes of revival.
New policy measures were announced on Thursday to strengthen the regulatory framework at the UCBs.
A granular look reveals the disarray: All lead indicators point to a dismal manufacturing growth.
- No blogs yet have been written by the author, we’re sure the author will contribute one soon