For the week ended July 30, 2016:
- It was a week of mixed data trends for the Indian economy. The centre’s finances for the first quarter of 2016-17 showed healthy growth in receipts, led by tax collections. However, expenditure is also slightly increased. This would not be a significant highlight if the expenditure quality was in check.
- At the present time, however, capital spending has declined compared to last year, while the increase in total spends is on account of revenue expenditure. Fiscal deficit is at 61.1% of budget estimates for 2016-17, but it is too soon to draw any firm conclusions from this.
- Indian companies’ borrowings remains firmly dismal, as foreign borrowings continued to remain in freefall in June 2016, and domestic credit growth also slowed down to 7.3% year on year (yoy) on account of almost no change in industrial credit offtake.
- FDI inflows, however, remain strong. Initial figures released show FDI up to May 2016 at USD 7.5bn, which is a healthy growth over the same time last year.
- With the monsoon for the season as a whole remaining normal, crop sowing trends remain positive. Area under cultivation increased by 6.3% for the week ended July 29, 2016. Area under major crops like rice, oilseeds and coarse cereals continued to expand.
- Brexit impact showed up on the GBP exchange rate against the INR, which showed maximum change during the week compared to other major currencies.
This summary is part of our weekly subscription based report – India Macro Weekly. To know about the subscription details, please write in at firstname.lastname@example.org and we will respond to you as soon as we can.