The last week saw the markets snap their longest stretch of weekly gains since January due to the falling rupee and the consequent rise in domestic fuel prices.It has led to concerns about economic and earnings growth.
The rupee slipped beyond the 72 mark during the week despite the RBI’s intervention. Higher crude prices and tariff wars led to weak global cues.
Negotiations to revamp the North American Free Trade Agreement (NAFTA) continued between the United States and Canada, with Trump hinting that he is prepared to move forward even without Canada’s participation.
Domestic automobile sales in August posted moderate growth due to the combined impact of a delayed festive season, severe floods in Kerala and heavy rainfall in several other states.
Here are the global and national events that are likely to impact economy and businesses this week.
Global Trade Tensions to Continue
US President Donald Trump warned on Friday that he was ready to slap tariffs on virtually all Chinese imports into the United States. This would mean duties on goods worth another $267 billion, in addition to the $200 billion already facing the risk of duties. News reports also indicated that Trump may expand his trade fight to Japan.
Govt Pushing For Share Buybacks
The Indian government has decided to go slow on fresh share sales in public sector companies due to uncertain market conditions. News reports said that the government is pushing for buybacks in around a dozen companies to meet its disinvestment target of around Rs 80,000 crore.
Balance of Payments deficit
The balance of payments slipped into deficit for the first time in six quarters on large foreign dollar outflows. The deficit in April-June quarter was $11.3 billion, compared to a surplus of $11.4 billion a year earlier, Reserve Bank of India data showed on Friday. The current account deficit widened to $15.8 billion for the quarter ending June from $15 billion or 2.5% a year ago. The balance of payment deficit is a measure of economic transactions between the country and the rest of the world.
Data release this week
- Domestic IIP for July will be unveiled on Wednesday (September 12)
- Retail inflation for August will be declared on Wednesday (September 12)
- Wholesale inflation data to be released on Friday (September 14)
- Policy decisions from the Bank of England and the European Central Bank on Thursday (September 13)
- Apple unveils its latest iPhones Wednesday (September 12)