India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
India – Economics (Current account continues to worsen):
India’s current account deficit continues to widen and at US$15.8bn in the September quarter was up 70% YoY and 30% QoQ (another quarterly record). Over the trailing four quarters, India’s current account deficit has crossed US$50bn and exceeds 3% of GDP. Capital inflows totalled US$20bn in 2Q, up 25% QoQ. However, given the increase in current account deficit, capital flows are just about adequate to fill the deficit. BoP surplus (excess of capital flows over current account deficit) for the first two quarters has totalled just US$7bn or under 1% of GDP on an annualised basis. We are increasing our full year current account deficit estimate to US$55bn from US$51bn earlier, largely due to slower-than-expected recovery in invisibles. At our new estimate, current account deficit will total 3.5% of GDP – the highest ever (and this will rise further in FY12). Large and rising current account deficit and the consequent rising dependence on capital flows (especially discretionary portfolio flows due to decline in FDI) is the principal medium-term risk for India, in our view.
No comments:
Post a Comment