ANI
02 Jul 2022, 15:25 GMT+10
New Delhi [India], July 2 (ANI): India's retail inflation during the financial year FY22-23 is expected to average at 6.8 per cent, as compared to 5.5 per cent the previous year, said rating agency CRISIL in a report.
It added that the impact of this year's heatwave on domestic food production, coupled with persisting high international commodity prices and input costs for various sectors, will cause a broad-based rise in the inflation rate.
The sharp rise in commodity prices post the Russia-Ukraine conflict is a major cause for concern. The European Union announced in May that it would ban 90 per cent of Russian crude oil by end of 2022.
The rating agency expects crude oil to average in a range of $105-$110 per barrel, which is a sharp increase in comparison to $80 per barrel in the previous fiscal FY22.
Additionally, it forecasts India's real gross domestic product growth at 7.3 per cent, with some downside risks.
The major downside risk mentioned in the report is high crude oil prices, which would cause a domino effect on India.
Besides, slowing global demand for India's exports and high inflation too are a matter of concern.
"Inflation reduces purchasing power and would weigh on revival of consumption - the largest component of GDP which has been backsliding for a while," it said.
The country's current account deficit (CAD) is expected to widen to 3 per cent of GDP this fiscal, up from 1.2 per cent the previous fiscal.
"Elevated commodity prices, slowing global growth, and supply chain snarls do not augur well for India's current account balance," it added.
The rating agency further added that the exchange rate between Rupee and Dollar will remain volatile, with a bias to depreciation of the rupee.
The continued outflows of foreign portfolio investments along with the strengthening of the value of the US Dollar may also become a cause for concern while leading to the depreciation of the Rupee.
It expects the Rupee exchange rate to be at Rs 78 per US Dollar by March 2023, as compared with 76.2 in March 2022. (ANI)Get a daily dose of Germany Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Germany Sun.
More InformationSAN FRANCISCO, California: Under pressure from European regulators, Apple has revamped its App Store policies in the EU, introducing...
A new law in Denmark subjects 18-year-old females to the draft starting July 1 Women in Denmark are now subject to conscription,...
The inflation is driven by the price of services, which recorded a yearly inflation rate of 3.3 percent in June, up from 3.2 percent...
The Russian Foreign Ministry has condemned the prosecution in Moldova of regional head Yevgenia Gutsul as politically motivated repression...
Why Trump managed to settle the conflict in the Middle East but not in Eastern Europe US President Donald Trump secured his image...
A video posted on Facebook by Kostadin Kostadinov, leader of the Revival party, claims that once Bulgaria joins the eurozone on January...
VILNIUS, Lithuania – A growing body of research suggests that selectively restricting a single nutrient in our diet could have profound...
DUBLIN, Ireland: Former government minister Mary Hanafin has confirmed she will seek the Fianna Fáil nomination to contest Ireland's...
FRANKFURT, Germany: Germany has become the latest country to challenge Chinese AI firm DeepSeek over its data practices, as pressure...
DUBLIN, Ireland: Ireland's EU Commissioner Michael McGrath has defended Commission Vice President Kaja Kallas over her recent comments...
SAN FRANCISCO, California: Under pressure from European regulators, Apple has revamped its App Store policies in the EU, introducing...
BONN, Germany: Despite widespread belt-tightening across the United Nations, nearly 200 countries agreed this week to increase the...