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Nomura Forecasts Higher CPI, Deficit For India Amid Economic Recovery

The step came due to the higher energy costs amid the coal crisis. The institution said that these things have a cascading effect on supply chains, and then consumption.

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Amid the ongoing inflation fluctuations in the country, Nomura Global Markets Research increased its estimates for consumer price inflation (CPI) for 2022, and fiscal deficit and current account deficit for fiscal year (FY) 2022 for India. 

The step came due to the higher energy costs amid the coal crisis. The institution said that these things have a cascading effect on supply chains, and then consumption. 

The firm on Monday said that we have raised our 2022 CPI inflation forecast by 0.3 percentage points (pp) to 5.5 per cent. The FY22 fiscal deficit by 0.3 pp to 6.5 per cent of Gross Domestic Product (GDP) and current account deficit by 0.1 pp to 1.7 per cent of GDP. 

The company said, "The government recently reduced fuel excise duties to lower inflation pressures, but the broad-based surge in higher energy costs will add to headline inflation, in addition to spilling over to higher transportation costs, food inflation and rising inflation expe expectations." 


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nomura Higher CPI deficit india economic recovery