Expert Eye
Investors India|January 2022
If I’m betting on one country in Asia, it’s India and if I’m betting on two countries in Asia, it’s India twice. — John Chambers
Nilesh Shah
Expert Eye
Global Economy: Central banks have printed and pumped a huge amount of money into the global financial system, in order to keep interest rates low in the hope of driving economic growth. The G10 central bank balance sheet now is crossing US$ 25 trillion.

Globally equity markets have run up sharply, at the same time there are certain red zones in markets. Today, more than half of US growth stocks actually have negative earnings and still at higher valuations.

Now, inflation is rising in most parts of the world. Emerging markets have especially started raising rates and some developed markets will follow them.

China plays an important role in the global economy, concerns are emerging around China’s debt-fueled GDP growth. China is following the footsteps of Japan in terms of debt as a % of GDP. Government, households and non-financial corporates are heavily leveraged.

Indian Economy: Fortunately, for India, even with the Omicron variant active cases have remained below one lakh. Business activity is now above the pre-pandemic level and this is reflected in business resumption index touching 114.9 from the bottom of 63.2 in the second wave.

If you look at various high-frequency indicators, 19 out of 22 indicators are now showing positive momentum and only 3 indicators are showing negative momentum. It’s fair to say that overall economy has picked up momentum and we are seeing a V-shaped recovery in many segments and K-shaped recovery in few segments.

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