Panorama – October 2023

Panorama October 2023 edition is out now!

Panorama is a meticulously crafted report that offers an overview of the macro factors and market trends influencing the Indian economic landscape.

Here are the key insights from the report:

  1. An increase in financial liabilities leads to a decrease in the net financial savings of households (incremental assets – liabilities) in FY23. Net financial savings of households (% of GDP) are the lowest observed since 1976.
  2. Deposits continue to account for an outsize 37% share in financial assets in FY23, followed by 22% share of provident and pension funds, and 18% share of life insurance funds. MF, shares & debentures account for only 7%. The share of deposits in household financial assets may continue to remain high in the near term as banks compete for deposits and offer attractive term deposit rates.
  3. India’s household debt is below the emerging market average and doesn’t pose any systemic risks. Only one-third of the incremental household credit (non-mortgage retail) in FY23 was oriented towards consumption and may warrant monitoring. The quality of incremental household financial liabilities has improved in Q1FY24.
  4. Lower interest rate differential between India and developed markets could restrict capital inflows after the initial surge resulting from index inclusion.
  5. Yields on longer-dated US bonds have risen at a faster rate than yields on short-dated debt, driven by positive economic data, increased bond issuances, and expectations of higher rates for longer duration.
  6. Crude oil prices are expected to remain rangebound with geopolitical conflicts posing a risk to the outlook. Marketing margins for Oil Marketing Companies (OMCs) have decreased due to the surge in oil prices. Nevertheless, there remains a possibility of reduced pump prices if the government decides to lower excise duties on petrol and diesel.

Click here to read the full report

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