Economic Indicators (as on September 30, 2022)

Inflation in India (%)

Consumer Price Index snapped out its 3 months downward trend and increased to 7% in Aug’22, from 6.71% in Jul’22 due to spike in food prices. The current level of inflation continues to remain above 6% mark for the eigth consecutive month. Wholesale Price Index (WPI) decreased to 12.41% in Aug'22 from 13.93% in Jul'22 amid a slowdown in prices crude and manufactured products. The current level of inflation continues to rise above RBI’s limit of 4%-6% in response to rise in prices of mineral oil, natural gas, basic metals, chemicals and chemical products, food articles etc.

Index of Industrial Production (%)

ndex of Industrial Production (IIP) fell to 2.4% in Jul’22 from 12.7% in Jun’22 showing the weakest increase in industrial activity since March. The electricity sector, manufacturing and mining sector rose by 2.3%, 3.2% and 3.3% respectively in Jul'22

Indian Business Indicators - Purchasing Managers' Index (PMI)

S&P Global India Manufacturing Purchasing Managers' Index (PMI) saw a downfall to 55.1 in Sep’22 from 56.2 in Sep’22 but it still remains in good shape despite fears of global headwinds. PMI Services decreased to six month low to 54.3 in Sep'22 from 57.2 in Aug'22 due to cooling in demand amid inflationary pressures. The reading remains in the expansion zone as a print above 50 means expansion while a score below 50 denotes contraction.

USD INR & Brent Crude Movement

Brent crude oil stood at ~US$ 87.96 due to the demand supply disruption across the world on concerns over slowdown in global growth, rising inflation and worries of more interest rate hikes by the central banks in the coming months led to fears of a recession which hit the demand outlook of the commodity. The Rupee closed the month on 81.35 against Greenback as on Sep'22.

Equity Markets - India & US

Bellwether indices, Nifty 50 and S&P BSE Sensex declined by 3.74% and 3.54% respectively majorly led by global macroeconomic uncertainty, rising interest rates across the globe and selling from foreign Institutional Investors in the domestic equity market. Goods and Services Tax (GST) collection stood at ₹1.47 lakh crore in Sep’22, which is 26% more than the corresponding period of last year. Foreign Institutional Investors (FIIs) were net sellers in Indian equities to the tune of Rs.7623.63 crore this month. Dow Jones reduced drastically by 8.84% from previous month.

Interest Rate Movement (%) - India & US

Yield on the 10-Year benchmark paper spiked, closing at 7.40% on 30th Sep'22 vs 7.19% on 30th Aug'22 following over aggressive monetary policy tightening. MPC raised key policy repo rate by 50 bps and U.S. Fed raised interest rates by 75 bps which was as per market expectations and indicated more rate hikes in the upcoming meetings. The U.S. Fed chief indicated that it may slowdown the pace of rate hikes in the future meetings which also aided market sentiment. 10-year U.S. Treasury bond closed higher at 3.83% on Sep'22 vs 3.19% on Aug'22.