Economic Overview : April 2016 - A Glimpse into Financial Year 2016-17 Macro

   

Get an outlook on how the macro variables are likely to behave in Financial Year 2016- 2017 Economic Overview April 2016 A Glimpse into Financial Year 2016-17 Macro Ms. Meghna Shah, Chief Economist - UTI AMC, provides an outlook on how the macro variables are likely to behave in the Financial Year 2016 - 17. Highlights stated below: • With coordinated efforts from the Government and the RBI, FY16 largely marked favourable macro dynamics and stability to a large extent - FY17 is likely to be an extension of FY16. • India’s GDP recovery remains slow with two consecutive years of deficient monsoon, weak rural demand, subdued industrial production and weak investment cycle. • For FY17, we expect gradual recovery to continue aided by the tailwinds from low commodity prices, low inflation, the gradual transmission of policy rate cuts into lower bank lending rates etc. • Growth recovery to remain tepid and supported by consumption. • CPI inflation is likely to average around 5% in FY17 • With the partial implementation of 7th PC, there could be only limited upward pressure on headline inflation. • Aggregate fiscal consolidation amidst the need to spur growth would likely be difficult. • The external balances do not seem to portend any concern on the financing of the current account. We wish you a happy and successful new financial year 2016 -17.

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