INDIA UNDER RENOVATION

INDIA UNDER RENOVATION

The iconic BSE towers at Mumbai undergoing through some renovation activities at present

A good decision made of knowledge but not of numbers - PLATO. 

A Brief Note: Any renovation activity of any structure certainly cause some sort of inconvenience to the residents living in the structure. Incase India as a nation requires renovation , then it will certainly create major inconvenience to the people of the nation , but  Politicians and policy makers at least should have knowledge of major consequences that impacts people life , even though if they don't knew numbers .

Why Indian Markets are sliding down: At global front Brexit implementation, as the wave of protectionism pass through different continents Theresa May is stern on this, Indians are ignoring this but this will have a major impact, and consensus on Fed rate hike in December as FOMC focuses on Trumpation but not on inflation .

On domestic front: Market were exuberant running based on good monsoon on citing rural consumption all these days, but due to demonetization last 15 days rural consumption came to stand still  and urban & semi urban consumption is on single digit . People are very cautious in spending 

Rs 100. Capital Markets are anticipating same saga continuing for some more time, which will have big negative impact on 3rd quarter earnings and GDP growth.

How long the saga continues:  Hard to digest but at present RBI Printing quantity capacity for the month is 300 crores notes per month. To replace approximately 15 lacs crore rupees of existing Rs 500 and 1000 notes with new Rs 100 , 500 denominations, it will take government to at least 4 to 5 months , that's the reason RBI introduced Rs 2000 notes . Unfortunately RBI cannot outsource currency printing to increase the printing quantity capacity .So it will take 1 to 2 months to get required float of currency to resume consumption. In the meantime, earnings and GDP will take major hit in short term.

As the India’s currency renovation exercise completes in few months, let’s hope and ready to see a beautiful India soon.