A $5-trillion economy will be possible only if government spends money on these sectors
Santosh Pandey, President and Head, Nuvama Professional Clients Group, talks to BT about the path ahead for the Indian economy
- Sep 4, 2023,
- Updated Sep 4, 2023 2:47 PM IST
The US 10-year treasury yields recently scaled 15-year highs amid hopes that interest rates will remain on the higher side for longer than initially anticipated. As a result, the 10-year US treasury yield jumped to as high as 4.35 per cent in the second half of August and it is hovering at around 4.20 per cent. The figures stood at 3.9 per cent on January 2, 2023. On the other hand, India 10-year government bond yield declined marginally to 7.34 per cent in January to 7.2 per cent at present. So, what do sharp rise in US treasury yield meant for Indian economy? And where rupee is headed? In an interaction with Business Today, Most other high-frequency services-oriented indicators, especially in the transport/logistics side, continue to show traction in growth terms. Services growth continues to lead domestic economic recovery. July 2023 services PMI rose to a high of 62.3 from 58.5 in June, signalling the sharpest increase in output since June, attributable to strength in demand and new businesses. Business and consumer sentiment continues to improve incrementally. Additionally, adjusted for inflation, real bank credit growth is currently running at its highest levels in the last 10-years. Ebbing of twin balance sheet concerns has boosted credit appetite along with the post pandemic economic recovery. This should help support a private sector capex upcycle.
The US 10-year treasury yields recently scaled 15-year highs amid hopes that interest rates will remain on the higher side for longer than initially anticipated. As a result, the 10-year US treasury yield jumped to as high as 4.35 per cent in the second half of August and it is hovering at around 4.20 per cent. The figures stood at 3.9 per cent on January 2, 2023. On the other hand, India 10-year government bond yield declined marginally to 7.34 per cent in January to 7.2 per cent at present. So, what do sharp rise in US treasury yield meant for Indian economy? And where rupee is headed? In an interaction with Business Today, Most other high-frequency services-oriented indicators, especially in the transport/logistics side, continue to show traction in growth terms. Services growth continues to lead domestic economic recovery. July 2023 services PMI rose to a high of 62.3 from 58.5 in June, signalling the sharpest increase in output since June, attributable to strength in demand and new businesses. Business and consumer sentiment continues to improve incrementally. Additionally, adjusted for inflation, real bank credit growth is currently running at its highest levels in the last 10-years. Ebbing of twin balance sheet concerns has boosted credit appetite along with the post pandemic economic recovery. This should help support a private sector capex upcycle.