1. At $72.1billion, FDI Inflows Highest In 1st 10 Months
The value is 15% percent higher as compared to the first 10 months of 2019-2020 at $62.72 billion. Equity inflows grew 28 percent YoY to $54.18 billion during first 10 months of the fiscal year.
Measures taken by government on the fronts of FDI policy reforms, investment facilitation and ease of doing business resulted in increase in FDI even though fund flows in developed nations such as US and other European countries plummeted..
2. Manufacturing PMI Hits 7 Month Low in March
Growth in manufacturing slows as increasing Covid cases hit demand. The data comes on the day the Reserve Bank of India’s monetary policy committee sits for deciding policy rates
PMI data corroborates with the core sector data for the month of Feb. Core sector output contracted by 4.6 percent in the month. However, the vaccination programme is expected to curb disease and underpin output growth in the year ahead meant that business confidence index remained positive.
3. India To Grow 12.5% This Fiscal: IMF.
The forecast published in IMF’s World Economic Outlook, suggests that Indian would again become the fastest growing large economy in the world.
IMF’s projections for India’s in the current financial year is the upper end of a range that of World Bank’s forecast. The IMF has also projected a stronger recovery for the global economy, at 6 percent in 2021.
4. RBI Takes The QE Road
The Reserve Bank of India took a step towards formalizing its own version of quantitative easing, committing to support the bond market through secondary market purchases starting with INR 1 trillion in first quarter. MPC voted for status quo on benchmark rates as long as necessary.
The MPC came up with a new policy tool kit called ‘secondary market G Sec acquisition programme’ or G SAP1.0 for overall liquidity management. This programme will start with INR 25000 crore bond buying on April 15 and will help the market plan their liquidity requirement better.
5. Services PMI Expands At Slower Pace In March
Activity in services sector continued to expand in March, but at a slower pace with rising Covid-19 cases resulting in lower footfalls and consumer uncertainty. The IHS India Services Markit Business Activity Index eased to 54.6 in March from 55.3 in February.
Firms had overall positive outlook for the year ahead business activity, but the overall confidence was unchanged from Feb and remained below its long term average.
