BUDGET EXPECTATIONS: ECONOMY

12 Jan 2023 , 05:22 AM

Revenue overshot should help meet the budgeted deficit target amounting to 6.4% of GDP. Decision to reorient the food subsidy program is positive for the fiscal math. We expect the FY24 Budget to focus on four priorities, including a rural focus, capex, and manufacturing push as well as prioritizing macro stability.

Implications on forecasts: We peg the FY24 deficit at 5.9% of GDP

Implications for markets: Bond markets will have to contend with a busy bond pipeline