(The views expressed in this column are the author’s own and do not represent those of Reuters)

On April 11, the CSO announced a further dip in industrial growth to 3.6 percent, bringing the Sensex down 189 points. That index was for February, the expectation about March is no better — which leaves the market a little cold.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

China has been under strong pressure from the US to revalue the yuan because in the US balance of trade deficit, China has the lion’s share.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

The Sensex jumped 465 points on 25th March to close at a two-month-high of 18,815. That was in response to economic recovery in the US and better performance by IT companies. Another 5 percent  jump can take the Sensex to 20,000. How soon can that be?

(The views expressed in this column are the author’s own and do not represent those of Reuters)

On March 17, the RBI will review the quarterly performance of the economy and readjust the repo rate. In the past one year the rate was jacked up seven times at 25 bps on each occasion from 4.75 to 6.5 percent. The target was inflation.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

Finally debt is receiving serious attention. The finance minister reminded the states about the road map laid out by the 13th Finance Commission which requires that they eliminate the revenue deficit and restrict the fiscal deficit to 3% of their respective Gross State Domestic Product so that the combined state debt will not exceed 24.3% of GDP by 2014-15.

The bottom line in the Budget is the fiscal deficit. It reflects to what extent the Finance Minister will draw on private savings to fund current and capital expenditures.

The part that is used to fund revenue deficit is the erosion of savings and increase in government consumption. In any case, the higher the deficit, the more the crowding out of the bond market, less funds for the corporates and higher consequently inflation and interest rates.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

The economy is under some stress. Inflation has relapsed and interest rates have jumped. Industrial growth has plunged but exports have been performing well. Parliament is paralysed. That puts the 2011 budget under pressure.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

January was a big disappointment to the stock market. The Sensex which had crossed the earlier peak was already down to 20,000 at the beginning of 2011. It gradually slumped further during the first three weeks and dropped with a thud towards the end of the month. There were reasons not all very apparent.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

The rise in food inflation was a shocker. Prices jumped 18.3 percent giving the government and the RBI an uneasy feeling and the stock market a big disappointment. In spite of promises, it looks like headline inflation will not drop below 6 percent by March.

(The views expressed in this column are the author’s own and do not represent those of Reuters)

The rupee has gone through a rollercoaster ride in the past year, being pushed up by foreign investment and down by trade deficit.