The February inflation numbers has rose to 6.95% MoM, a bit higher than expected at 6.75% according to a CNBC-TV18 poll. Wholesale prices rose 6.55% in January, the slowest in 26 months. The annual reading for December was revised up to 7.74% from 7.47%, the government said in the release.
The Reserve Bank will watch this number very crucially, it is the last major data point that comes out before the crucial credit policy on Thursday. The RBI has repeatedly said that while growth is important target inflation will continue to remain important. Most of the economists are going with a no action credit policy but if the inflation numbers were to come very benign below 5.7% on manufacturing and below 6.7% overall then there is a possibility that the RBI may think that there is enough tendency or trend of a decline in inflation. So it's a crucial number to watch out for today. On Wed, Mar 14, 2012 at 10:20 AM, RAJESH DESAI <[email protected]> wrote: > US Feb retail sales came in at consensus +1.1m-m sa. FOMC statement noted > an improving US economy, with improvements in the labour market, consumer > spending, business investment, while long term inflation expectations > remain stable despite recent gains in oil. Downside risk remains 'strains > in global financial markets' (i.e. Europe). Nonetheless, it believes that > interest rates would be kept where they are now, 0-25bp, till end-2014, to > support a 'stronger economy recovery'. > > Fed also announced that 15 out of 19 banks could maintain capital > adequacy, dividend payouts and stock buybacks, even under its stress test > scenarios of 13% peak unemployment, 50% decline in equity markets and 21% > decline in house prices. The announcement was catalytic to US bank stocks > advancing more than 5%. > > US markets were buoyed by the flying colours the Fed stress tests gave to > US banks which led the strong upward movement in stock prices, the S&P500 > could be finished with its consolidation. ASX and NZX are rallying strongly > this morning so it is quite likely the STI and Asian markets will build on > yesterday's positive move. Consolidation/correction could be over. > Beyond the immediate, over the short to medium term, we have been saying > that stocks face a strange win-win underlying scenario, with corrections > likely used to add positions: if economic data is strong, stocks will of > course rise; if economic data is weak (as we think it will be), corrections > will likely give way to a wave of policy induced buying. This policy safety > net, though largely still in place and accommodative, has however been a > bit weakened: Bernanke omitted QE3 from his last testimony and the ECB's > latest message was that it was looking to reverse its wave of liquidity, > China however remains the more likely prospect of a fresh policy > announcement. > > > -- > CA. Rajesh Desai > > -- CA. Rajesh Desai -- You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en.
