India to meet next year's fiscal deficit target: Moodys
The Dollar Business Bureau International credit rating agency Moody’s Investors Service said on Monday that India’s Union Budget 2018-19 had struck a balance between growth and fiscal prudence. And a little slippage in the target of fiscal deficit would not have material effect on the overall fiscal strength of the country. In the Budget, presented on February 1 by Finance Minister Arun Jaitley, the Government has revised its fiscal deficit target for 2018-19 to 3.3% of gross domestic product (GDP) from the previous estimates of 3%. The estimate for 2017-18 has also been revised to 3.5% of GDP, from the original projections of 3.2%. “The revised fiscal consolidation path is modestly shallower than the previous road map, but it does not fundamentally alter India's overall fiscal strength,” said ...
Moody's predicts this year's G20 economic growth at just over 3%
The Dollar Business Bureau The Moody’s Investors Service predicted the G20 economic growth at over 3% for this year and the next. It also warned of challenges like US protectionism, China’s deleveraging measures and geopolitical risks. The agency said strong data in the first half of the year prompted it to raise the 2017 growth forecasts of China to 6.8%, South Korea to 2.8%, Japan to 1.5%. It also expects the euro zone to increase in the rest of the year, as suggested by the robust indicators and therefore forecast positively for France, Italy and Germany. Its forecast for United States however was reduced to 2.2% for 2017, 2.3% for 2018, from its earlier prediction of 2.4 and 2.5% mentioning the superpower’s weaker-than-expected ...
China considers change in procedure to stabilise currency
The Dollar Business Bureau To reinforce its control on its currency, China is “considering” a modification in its procedures that would help in bringing more stability to the country’s financial system in near-term. “We were “considering” a change in procedures that would reinforce our control of the renminbi, said Chinese officials. This move by Beijing would probably bring more stability in short-term to the country’s financial system, which has already been the subject of new focus after the credit rating agency Moody’s Investors Service on Wednesday downgraded China’s credit rating on bonds, mentioning its rising debt. Moody's downgraded the country’s sovereign ratings to A1, stating it believes that the financial strength of the second largest economy of the world would erode in the coming years due ...
Note ban to affect NBFC collections in short term: Moodys
PTI Moody’s Investors Service on Tuesday said non-banking financial companies (NBFCs) will demonstrate broadly stable asset quality, but delinquencies could rise over the next 1-2 quarters as demonetisation adversely affects collections across asset classes. It said the growth in loans against property has outpaced overall retail credit growth in recent years, but relatively loose underwriting practices, combined with intensifying competition, will translate into higher asset quality risk for this segment. “NBFCs in India will demonstrate broadly stable asset quality, but delinquencies will likely rise over the next 1-2 quarters, as demonetisation adversely affects collections across asset classes,” Moody’s said in a statement. Over the past three years, NBFCs have gained some market share in the origination of retail lending on the back of faster ...
11 PSBs need Rs.1.2 lakh cr infusion by 2020: Moodys
The Dollar Business Bureau The government needs to infuse Rs.1.2 lakh crore into 11 public sector banks (PSBs) by 2020 to strengthen their books, said credit rating agency Moody's. “The State Bank of India (SBI) and 10 other PSBs (including Bank of Baroda and Bank of India) will have to be infused with Rs.1.2 lakh crore, much higher than the government has planned to inject, to boost their balance sheets,” said Moody’s Investors Service on Friday. The government has announced to infuse Rs.70,000 crore as capital for 22 PSBs till March 2019. Out of this, an amount of Rs.25,000 crore has already been infused and the government is planning to inject an equal amount during this fiscal. “In the wake of their results for ...
Emerging markets face risk from US Fed rate hike
The Dollar Business Bureau As the US Federal Reserve is likely to increase the interest rate on Wednesday for the first time since 2006, Moody’s Investors Service on Tuesday said the move may pose a threat to some emerging markets. According to analysts, the US central bank in its Federal Open Market Committee (FOMC) meeting to be held on Wednesday is expected to announce a hike of a quarter percentage points in the short-term interest rate. While the move would “confirm that the US economic expansion remains on track”, higher rates could bring “risks to some emerging market sovereigns”, said Moody's Investors Service. The direct impact of any rate increase on the US economy should be minimal as the US ...
Moody's raises Indias credit rating outlook to positive
The Dollar Business Bureau Moody's Investors Service has on Thursday, affirmed the Government of India's credit rating outlook to ‘positive’ from ‘stable’. Moody's decision to revise the ratings is based on its view that there is an increasing probability that actions by policy makers will enhance the country's economic strength and, in turn, the sovereign's financial strength over coming years. India has grown faster than similarly rated peers over the last decade due to favourable demographics, economic diversity, as well as high savings and investment rates. Moody's expects these structural advantages, supported by relatively benign global commodity prices and liquidity conditions, will keep India's growth higher than that of its peers over the rating horizon. However, recurrent inflationary pressures, ...
