Economy Round Up – April 07 to 11, 2014

The IMF forecasts global growth to average 3.6% in 2014? up from 3% in 2013?and to rise to 3.9% in 2015

April 15, 2014 5:24 IST | India Infoline News Service

Top Stories

Dance of Democracy: Highest ever voter turnout in most places

Whether it is a vote for change or the enthusiasm of many of the first time voters, the fact remains that this election has so far seen one of the highest voter turnouts in most constituencies. India's elections kicked off on Monday. Thursday saw voting in 92 seats across 14 states and Union territories, including Delhi, Kerala and parts of Uttar Pradesh, Maharashtra and Orissa. Delhi saw 64.77% turnout as the contest heated up between Congress, BJP and Aam Aadmi Party. Lakshadweep Lok Sabha constituency recorded 87.05% polling for the lone seat. Kerala saw 76% voters turning up while Odisha saw 67% turnout.

Jharkhand’s turnout stood at 58.30. Uttar Pradesh's first phase polling in ten constituencies saw over 64% turnout. Madhya Pradesh saw an average 56.60% turnout in the nine constituencies that went to polls on Thursday. The polling in Maharashtra’s constituencies was lesser than expected ranging between 62-68%. Jammu-Poonch parliamentary constituency on Thursday recorded 68% polling. In Bihar the turnout was over 50% on an average. Haryana saw healthy voter turnout of over 73%. Union Territory Chandigarh created a record of highest ever poll percentage of nearly 74%. Chandigarh. The voting for the two parliamentary seats in Goa would be held on Saturday. Tripura's second Lok Sabha seat will see polling on Saturday too.

High voter turnout in western Uttar Pradesh

Harayana witnesses 73% voting

64% voter turnout in Delhi

Lok Sabha Elections: Mizoram votes

Lok Sabha Elections: Final Arunachal turnout figures today

Lok Sabha Elections: Priyanka to campaign in Rae Bareli, Amethi

To ensure stable growth, global rules of the game need to be revisited: RBI

A good way to describe the current environment is one of extreme monetary easing through unconventional policies, Dr Raghuram Rajan, Governor, Reserve Bank of India, said. Speaking at the Brookings Institution on Thursday, Rajan said, "In a world where debt overhangs and the need for structural change constrain domestic demand, a sizeable portion of the effects of such policies spillover across borders, sometimes through a weaker exchange rate. More worryingly, it prompts a reaction. Such competitive easing occurs both simultaneously and sequentially, as I will argue, and both advanced economies and emerging economies engage in it. Aggregate world demand may be weaker and more distorted than it should be, and financial risks higher. To ensure stable and sustainable growth, the international rules of the game need to be revisited. Both advanced economies and emerging economies need to adapt, else I fear we are about to embark on the next leg of a wearisome cycle.

Below are the excerpts of Dr Raghuram Rajan, Governor, RBI's speech:

Central bankers are usually reluctant to air their concerns in public. But because the needed change has political elements to it, I take my cue from speeches by two central bankers whom I respect greatly, Ben Bernanke in his 2005 "Global Savings Glut" speech, and Jaime Caruana in his 2012 speech at Jackson Hole, both of whom have raised similar concerns to mine, although from different perspectives...Read More

RBI proposes global crisis 'safety net'

RBI releases Draft Report on ‘Working Group on Pricing of Credit’

Banks to follow norms on sale / purchase of realty abroad: RBI

RBI shifts to CPI-based Real Effective Exchange Rate

NBFCs must deduct investments made in group entities: RBI

RBI revises booking of forward contracts norms

FM rejects RBI's proposal to restructure CMD's post in PSBs

RBI to issue Rs. 10 with inset letter 'A' in numbering panel

India's real GDP growth is projected to strengthen: IMF

The global recovery is becoming broader, but the changing external environment poses new challenges to emerging market and developing economies, says the IMF’s latest World Economic Outlook (WEO). The IMF forecasts global growth to average 3.6% in 2014? up from 3% in 2013?and to rise to 3.9% in 2015. The strengthening of the recovery from the Great Recession in the advanced economies is a welcome development, according to IMF staff. But the latest WEO also emphasizes that growth remains subpar and uneven across the globe. "The recovery which was starting to take hold in October is becoming not only stronger, but also broader," said IMF Chief Economist Olivier Blanchard. "Although we are far short of a full recovery, the normalization of monetary policy—both conventional and unconventional—is now on the agenda." Blanchard cautioned, however, that while acute risks have decreased, risks have not disappeared. In this setting, the global economy is still fragile despite improved prospects, and important risks—both old and new—remain. Risks identified previously include finishing the financial sector reform agenda, high debt levels in many countries, stubbornly high unemployment, and concerns about emerging markets...Read More

Govts must press ahead with spending reform: IMF

Emerging market economies have stronger fiscal positions: IMF

Real interest rates now close to zero; set to rise only moderately: IMF

Domestic car sales down 5% in March: SIAM

Domestic passenger car sales declined 5.08% to 1,71,489 units in March as against 1,80,675 units in the same month last year. Motorcycle sales increased 16.24% to 9,06,665 units in March from 7,80,022 units a year earlier, according to data released by the Society of Indian Automobile Manufacturers (SIAM). Total two-wheeler sales in March rose 21.16% to 13,34,214 units as against 11,01,203 units in the same month last year. Sales of commercial vehicles were down 24.55% to 64,101 units in March, SIAM said. Vehicle sales across categories registered an increase of 12.83% to 16,77,445 units from 14,86,664 units in March 2013, it added. For the fiscal ended March 31, 2014, domestic car sales fell 4.65% to 17,86,899 units as compared to 18,74,055 units in the previous year.

March trade data: March trade deficit at $10.5bn

India released its trade data for March today. The trade deficit narrowed by more than 40 percent from a year ago to $8.13 in February on a sharp fall in imports, further easing pressure on the country's current account balance.

  • March non-oil imports at $24.3bn Vs $20.12bn (MoM)
  • March trade deficit at $10.5bn Vs $8.13bn (MoM)
  • March trade deficit at $10.5bn Vs $10bn (YoY)
  • FY14 oil imports up 2.2% at $15.78bn Vs $13.7bn (MoM)
  • FY14 Exports at $29.57bn Vs $25.68bn (MoM)
  • FY14 imports at 40.08bn Vs $33.81bn (MoM)
  • March exports highest in last one year
  • Gold & silver imports down 17.27% at $2.76bn YoY
  • FY14 gold & silver imports down 40.2% at 33.46bn YoY
  • March iron ore exports up at 12.31%
  • FY14 iron ore exports up 1.9% at $1.7bn YoY
  • March petroleum exports up 0.01% at $60.85bn
  • March engg exports down 11% at $661 million YoY
  • FY14 engg exports down 6% at $75.8bn YoY...Read More

News Infocus

Job Rejection! A ‘no’ is not the end!

Facebook reject went on to sign a $19 billion deal with the company that once did not consider him worth employing… This story about WhatsApp founder Brian Acton is fast becoming the stuff of legend. However, equally interesting is what Acton posted online in the year 2009 once he was told he wasn’t getting the job – "Facebook turned me down. It was a great opportunity to connect with some fantastic people. Looking forward to life's next adventure." Hey, even Twitter didn’t think Acton had what it takes. "Got denied by Twitter HQ. That's ok. Would have been a long commute," is what he had posted on his, ahem, Twitter account after getting to know of the rejection.

As a recruiter, it’s these two sentences by Acton that have really caught my attention in the entire ‘WhatsApp sold to FB" saga. If only our candidates reacted so positively when informed that they were not considered a suitable fit in the companies we had helped them contact for job change. While the more positive ones shrug and move on with a "It’s their loss if they are not hiring a talent… I was doing good in my current company and another new company has recognized my talent," more often than not I’m faced with reactions like "How is that possible? I had an hour long interview with the CEO? Was I being led along for the last 6 months only to be rejected now?" Oh yes, I have had one of these too. Worse, he insisted on speaking directly to the MD about his rejection, only to earn himself a black mark...Read More

Why You should NOT pursue your 'Dream Home'

When you look at the hoardings and advertisements put up by real estate developers, the phrase 'dream home' is almost always part of the promotion. And since we all dream of owning our home one day, this is definitely a useful psychological hook to use in property promotion. But what really constitutes your dream home? Let us examine this in some depth. Home ownership is not a desire we suddenly wake up with one morning - as Indians, it is practically something we grow up with. It is the highest ideal of the Indian Way of Life to own a home, so we dream about ours from very early on. Usually, this 'dream home' is larger than life, beautifully decorated, in an impeccably planned neighbourhood and the envy of our friends and relatives. With the passage of time, our dream home tends to become a little more realistic. For example, most of us have to accept that a bungalow in the classiest part of the city may not be within our means. In other words, the mental imagery of a mansion surrounded by lush lawns and trees lining the compound fade, to be replaced by a spacious, ultra-modern flat. By the time we have launched our career and managed to save enough money for a down payment, even this picture will have moderated in accordance with new realities such as actual spending power...Read More

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