Stay tuned as the week is important for economy and consumers

11 June, 2012

The ongoing week and the next week is very important in terms of the Indian economy and the consumers. There will be three key domestic economic data in public domain along with one global figure, that will reveal the state of economic health.

FIRST IN line to hit the economic sentiment will be India's Industrial Production Output, the IIP data for the month of April, that would be announced on June 12.

The IIP figures for the month of March were discouraging for the economy with the industrial growth slipping by 3.5 per cent from the growth rate during the same month last year.

After the announcement of IIP data, on June 14 the government will come out with the headline inflation figures for the month of May. During the month of April the inflation rose to 7.23 per cent from the same period last year.

Both the figures, the IIP and the Inflation numbers, will be the key deciding factors when the central bank's governor and his team will sit on June 18 for the mid-quarter review of the credit policy and to announce the repo and reverse repo rates.

Notably, there is an all round demand from the industries that the RBI should now reduce the repo rate, the rate at which it lends to banks, for the sake of the south-going economy that grew at 5.3% during the January-March 2012 quarter, the lowest level over the last nine years.

Currently, the repo rate is at 8.0 per cent and it is a wide demand that the RBI should at least bring it down by 25 basis points.

An economist and Professor at National Institute of Public Finance and Policy while speaking to this Citizen Journalist said that there are chances of repo-rate being decreased by more than 25 per cent also. “It is likely that RBI will bring down the repo-rate. The reduction could be to the tune of 25 per cent or even more than that,” said Pinaki Chakraborty.

If the said reduction or more than the esteemed one, comes into effect, it will also bring relief to common consumers in the form of lower EMIs to be paid on home and other loans.

Along with the above three economic figures on domestic front, the presidential election results in Greece on June 17 will also be important for the global as well as Indian economy.