According to Central Statistics Office (CSO), the growth in gross domestic product (GDP) at factor cost at constant (2004-05 prices) is estimated at 5% in 2012-13 with agriculture, industry and services registering growth rates of 1.9%, 2.1% and 7.1%, respectively. The growth in GDP is placed at 4.8% in Q4 FY12-13.
BSE Sensex: Bell weather index S&P BSE SENSEX closed at 19,395.81 points on June 28, 2013. This represents a decrease of 1.84% in the index value in June 2013. The Sensex hit a high of 19,860.19 on June 03, 2013 and a low of 18,467.16 on June 24, 2013. The average intra-day volatility during the month was 1.28%.
RBI Monetary Policy:
The Reserve Bank of India (RBI) in its first quarter review of monetary policy 2013-14 kept both the repo rate and cash reserve ratio (CRR) unchanged. The repo rate—the rate at which the RBI lends money to banks—remains unchanged at 7.25%.
The reverse repo rate—the rate at which RBI borrows money from banks—stands at 6.25%. The bank rate is at 10.25%. The cash reserve ratio (CRR) is retained at 4%.
Rainfall: The cumulative rainfall received for the country from 1stJune to 18th July 2013 has been 16% above normal.
Foodgrains: As per the 4th advance estimates by Ministry of Agriculture, production of food grains is estimated at 255.36 million tonne during 2012-13 compared to 259.29 MT (final estimates) in 2011-12.
Procurement of rice as on 1 May 2013 increased 2.8% to 31.06MT in Kharif Marketing Season from 30.2MT last year in the corresponding period. Wheat procurement during Rabi Marketing Season 2013-14 is 20.76MT as compared to 20.83MT during the corresponding period last year.
Stocks of food-grains (rice and wheat) held by FCI declined 5.6% to 77.7MT as on June 1, 2013, from 82.31MT as on June 1, 2012.
During May 2013, the growth in IIP declined 1.6% as compared to 2.5% during the corresponding period of previous year. In electricity sector, the growth rate was 6.2% in May 2013, while in the mining sector and manufacturing sector, the growth rate was negative. The growth rate in intermediate goods and consumer non-durables sectors were 1.5% and 1.7%, respectively. In basic goods, capital goods, consumer goods sector, the growth rate was negative during May 2013.
Eight core industries: The index for eight core industries grew 2.4% during April-May 2013-14, as compared to growth rate of 6.5% during the corresponding period in 2012-13.
The eight core industries comprises crude oil, petroleum refinery products, coal, electricity, cement, steel, natural gas and fertilizers with a weight of 37.9% in the IIP.
During May 2013, the growth of the core sector industries was 2.3% compared to 7.2% during May 2012. During May 2013, the growth in electricity and refinery products was 6.2% and 5%, respectively followed by steel (4.1%) and cement (3%). The coal, crude oil, natural gas and fertilisers sectors have registered negative growth during May 2013.
Broad money: During 2013-14 (up to June 28, 2013), broad money stood at 4.3% compared to 5.3% during the corresponding period of the last year. The year-on-year growth, as on June 28, 2013 was 12.8% against 13.7% in the previous year.
Reserve money: In FY13-14 (up to June 28, 2013), reserve money rose 3.4% to 2.6% in the corresponding period of the previous year. The year-on-year variation revealed an increase of 7% (up to June 28, 2013) compared to 5.6% on the corresponding date of the previous year.
An important source of reserve money, namely, net foreign exchange assets (NFA) of the RBI, showed an increase of 4% y-o-y, as compared to an increase of 15.7% on the corresponding date of the last year.
Bank credit: During FY13-14 (up to June 28, 2013), bank credit increased 2.9% as compared to 3.3% during the corresponding period last year. The y-o-y variation revealed an increase of 13.7% as compared to 16.5% during the same period in the previous year.
Bank deposits: The aggregate deposits with scheduled commercial banks increased 5% (up to June 28, 2013), as compared to 5.5% during the corresponding period last year. The y-o-y variation revealed an increase of 13.8% as compared to 13.5% in the previous year.
Interest rates: As on June 28, 2013, bank rate was 8.25% per annum as compared to 9% per annum on the corresponding date of last year. Call money rates (weighted average) was 7.19% as compared with 8.13% on the corresponding date of last year.
Non-food credit: During this period, non-food credit increased by 2.7% as compared to a deterioration of 0.6% during the corresponding period of last year. The y-o-y variation revealed an increase of 14% as compared to 16.1% during the same period in the previous year.
Exports and imports (in US$ terms) decreased by 4.6% and 0.4% respectively during June 2013 over June 2012. Cumulative growth in exports and imports was 1.4% down and 6% respectively during the first quarter of 2013-14.
Foreign trade: Exports decreased by 4.6% and imports decreased by 0.4% in US$ terms during June 2013 over June 2012. During this period, oil imports increased by 13.7% and non-oil imports declined by 6.7% respectively.
Exchange rate: The rupee depreciated by 5.8% against US dollar, 7% against Pound sterling, 9.1% against Japanese yen and 7.4% against the Euro in the month of June 2013 over May 2013.
Wholesale Price Index (WPI 2004-05=100): The headline WPI inflation increased to 4.86% in June 2013 as against 4.7% last month.
Inflation for primary articles increased to 8.14% in June 2013 from 6.65% in the last month mainly on account of cereals, vegetables, egg, fish-inland, poultry chicken and spices.
Inflation for Fuel & power declined to 7.12% in June 2013 from 7.32% in May 2013. Inflation for Manufactured Products declined to 2.75% in June 2013 from 3.11% in May 2013.
Food inflation: Food inflation increased to 8.6% in June 2013 from 7.64% in the last month.
Consumer Price Indices: The all India CPI inflation (combined) increased to 9.87% in June 2013 from 9.31% in May 2013 mainly on account of increase in inflation of cereals, milk, vegetables and fruits.
India Infoline Research Team / 15:28, Mar 13, 2015
Markets are now reinforcing the perception of an early interest rate hike by US Federal Reserve, with consensus calling for the hike taking place in June, when compared with the prior expectations of a hike in September.