HSBC report News

The 40-basis-point budgeted fiscal consolidation suggests that peak drag growth from fiscal tightening is likely behind, even as the Indian government remains focused on fiscal consolidation, Goldman Sachs said.

The embattled edtech firm is struggling to pay employee salaries amid mounting legal battles. 

On RBI's policy stance, the report said, the RBI has enough reasons to raise rates by 50 bps in this cycle.

According to the global financial services major, although reforms over the past year have caused disruptions that will likely mean lower growth rates in the near term, they should allow India to unleash more of its undoubted potential over the medium term.

The Seventh Pay Commission and implementation of GST has put inflation in an uncertain zone, and prices are expected to rise temporarily, says an HSBC report.

India is the "obvious candidate" to push global growth amid a lingering slowdown but it will need sustained GDP expansion to reach, by the middle of next decade, the share of world GDP that China had at the height of its boom in 2005, says an HSBC report.

Medium-term growth prospect of the Indian economy is improving, and with the GST Bill likely to be passed later in the year, it will only improve further, says an HSBC report.

State governments are likely to run wider fiscal deficit in financial year 2016-17 because of higher interest bill and wage hike pressures, an HSBC report said on Monday.

The current account deficit narrowed in the October-December quarter of 2015 and is likely to shrink further in the March quarter of this year.

The main determinant of medium-term high and sustainable economic growth is meaningful reforms and so far they have been gradual and 'project-specific', the global financial services firm said.

According to the global financial services firm, food prices have been falling across all major sub-groups, across the CPI and WPI measures, both on annual and sequential basis.

The potential for equity outflows has increased, with foreign positions looking "stretched" in India, said the global brokerage.

Moreover, rising incomes and ease of travelling abroad is expected to continue to boost outbound travel.

Stars are "gradually aligning" for the Indian economy and it is expected to clock a growth rate of 7.4 per cent in the current financial year, which is likely to improve further to 8.3 per cent by 2016-17, says an HSBC report.

The headline HSBC India Purchasing Managers' Index (PMI) -- a composite gauge designed to give a single-figure snapshot of manufacturing business conditions -- fell from 52.9 in the previous month to a five-month low of 51.2 in February.

The HSBC preliminary purchasing managers index (PMI), which tracks activity in China`s factories and workshops, leapt to 52.0 this month, its highest since January 2013.