Key Points
Come 2024, even if global spillovers create volatility, the runaway depreciation of the Rupee may not happen as narrowing deficit have made the currency resilient, say economists...
The Reserve Bank is also equipped with a strong armoury of foreign exchange reserves of over $ 600 billion to defend the rupee compared to $292 billion in 2012-13 adding to the market perception that RBi is being extra vigilant..
In our view, the RBI is keeping liquidity conditions tight to protect the economy and the currency from undue volatility given the financial risks brewing globally wrote Neelkanth Mishra, chief economist at Axis bank in his outlook for 2024...
Goldman Sachs is also forecasting a narrower current account deficit for India in 2023 and 2024 on the back of lower oil price forecasts from $86/bbl (average) to $84/bbl in 2023 and fromabove $90/bbl (average) to $81/bbl in 2024, and services exports surprising higher than prior expectations..
The expected reversal in Fed policy stance, Indias inclusion in J P Morgan bond indices, and the slowdown in the developed economies is expected to induce higher capital flows to India unless there are new geo-political risks and surprises in the upcoming Indian election outcomes Suman Chowdhury, Chief Economist and Head Research, Acuit Ratings & Research...
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