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from Expert Zone:

India Markets Weekahead: Markets back on track for pre-election rally

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

The week started on a sombre note but with institutional activity picking up, the Nifty closed with gains of 1.97 percent at 6276 despite a mid-week trading holiday. Political activity also gained momentum with 11 parties coming together to form a Third Front to oppose both national parties.

 

The Election Commission may announce election dates in the coming week -- the code of conduct coming in will halt any policy decisions.

GDP growth for the December quarter of this financial year was slightly below market expectations at 4.7 percent, whereas the fiscal deficit exceeded the annual limit of $86 billion within 10 months. The previous year, we were at 89.4 percent of the annual limit. This puts a question on the finance minister’s ability to live up to his promises.

Next week, we will get manufacturing and services PMI data for February. Automobile numbers have been announced and despite an excise duty cut, most listed players are seeing flat to contracting sales as inventories build up.  Maruti was flat at 1.8 percent whereas Tata Motors and Mahindra & Mahindra declined.

from Breakingviews:

Review: GDP and its discontents

By Edward Hadas

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Gross domestic product is both a useful measure and a terrible one. Diane Coyle explains why in “GDP: A Brief but Affectionate History.” Despite some cogent arguments in support of its use, readers may struggle to share the British economist’s fondness.

from MacroScope:

Fundraising for Kiev

If the hastily drawn up timetable is adhered to an interim Ukrainian government will be formed today. Whatever the line-up, it is likely to repeat its urgent call for aid.

The West, led by the EU, is trying to drum up support – Brussels has already talked with Japan, China, Canada, Turkey and the United States on possible help -- but the signals are that big money will only flow after May 25 elections when a permanent government is in place. Can it wait that long? The IMF adds that conditions it imposed on a previous loan offer would still apply, strings that it would be tough for any government in Kiev to meet.

from MacroScope:

Oh là là, quelle surprise for the French economy

French economic growth unexpectedly picked up to 0.3 percent in the final three months of last year, welcome news and a rare positive shock for some particularly gloomy forecasters who were looking for shrinkage or no growth at all.

But the unexpected bounce may be partly for the wrong reason: government spending.

from MacroScope:

Firing up Brazil’s economy

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A hot, dry spell in southeastern Brazil has pushed up energy prices, stretched government finances and raised the threat of water rationing in its largest city, Sao Paulo, just months before it hosts one of the world's largest sport events, the soccer World Cup.

It looks like the last thing Brazil needed as it scrambles to woo investors and avoid a credit downgrade.

from Expert Zone:

Slow pick-up in India’s GDP growth

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

GDP estimates by the Central Statistics Office for the 2013-14 fiscal year show an improvement over the previous year. But the extent of improvement is too small for comfort. Possibly, in the final revision, that small margin may disappear or even turn negative.

This year, India’s GDP is expected to be up 4.9 percent from 4.5 percent the previous year. This additional growth has come mainly from agriculture, due to a favourable monsoon. Agricultural growth was three times the previous year. Production of non-food grains (like vegetables and fruits), and animal products (like meat and eggs), did not increase adequately in spite of the inflated demand and will continue to be the main source of inflation.

from MacroScope:

Brazil’s need for dollars to shrink in 2014 – but the long-term view remains bleak

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Brazil's current account deficit will probably narrow this year. That may sound as a reassuring (or rather optimistic) forecast after the recent sharp sell-off in emerging markets, which prompted Turkey to raise interest rates dramatically to 12 percent from 7.75 percent in a single shot on Tuesday. But that was the outlook of three major banks - HSBC, Credit Suisse and Barclays - in separate research published earlier this week.

The gap, a measure of the extra foreign resources Brazil needs to pay for the goods and services it buys overseas, will probably shrink to 3.0-3.4 percent of GDP in 2014, from 3.7 percent last year, they said.

from MacroScope:

The UK economy – what a difference a year makes

This time last year, an imminent sovereign credit rating downgrade and a 1-in-3 chance of a new recession dominated talk on Britain's economy.

To say 2013 turned out better than expected - at least by the simple yardsticks of economic growth and unemployment - would be an understatement, then, even if tepid wage growth, weak productivity and a rising cost of living still dog the economy.

from MacroScope:

Crunch day for Turkey, and Ukraine

Hard to look beyond Turkey today. The central bank will issue its quarterly inflation report and has called an emergency policy meeting thereafter and will deliver a verdict at midnight local time. All very cloak and dagger.

The central bank, under heavy political pressure, has so far not raised interest rates but is instead burning through its reserves to defend the tumbling lira with only limited success.

from MacroScope:

Why are US corporate profits so high? Because wages are so low

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U.S. businesses have never had it so good.

Corporate cash piles have never been bigger, either in dollar terms or as a share of the economy.

The labor market, meanwhile, is still millions of jobs short of where it was before the global financial crisis first erupted over six years ago.

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