Issue: 1209
· IMF flags global growth
slowdown risk to ~2–2.5% if geopolitical tensions persist.
· Eurozone inflation outlook
revised upward for 2026, though easing expected later.
· U.S. economy shows moderate
growth with ~2% GDP expansion in Q1 2026.
· RBI explores NRI deposit
scheme revival to boost dollar inflows amid rupee pressure.
· Government considers removal
of withholding tax on foreign bond investments to attract capital.
UBS cuts India’s FY27 GDP
forecast to 6.2% as oil shock, weak monsoon threaten economy: India’s economic growth could
slow sharply in FY27 as the ongoing Middle East conflict triggers a prolonged
energy shock, disrupts supply chains and pushes inflation higher, according to
a new report by UBS Research. The global brokerage has cut its FY27 India GDP
growth forecast to 6.2% from 6.7%, warning that risks remain tilted to the
downside if oil prices stay elevated and monsoon conditions worsen. The
report said the conflict has evolved beyond crude oil disruptions and is now
impacting refined fuel supplies, shipping routes and industrial supply chains,
creating what UBS described as a “historically large energy shock” for emerging
markets like India.
(Business Today)
India manufacturing PMI
rises to 54.7 in April, inflation pressures persist: Amid high-cost pressure,
India’s manufacturing sector performed better in April as the Purchasing
Managers’ Index (PMI) rose to 54.7, S&P Global reported on Monday. PMI in
March was 53.9. The index is based on responses from purchasing managers of 400
companies. An index above 50 means expansion, while an index below 50 means
contraction.
(Business Line)
Finances stable, but
freebies might hamper Tamil Nadu's fiscal maths: The Tamilaga Vettri Kazhagam’s
(TVK’s) election manifesto revolved around a mix of development projects and
freebies aimed at women, youth and the vulnerable sections of society. However,
fulfilling all the freebie promises might strain Tamil Nadu’s fiscal position,
which has remained largely stable after the Covid-19 pandemic. The manifesto
promised a Rs.2,500 monthly assistance to all women heads of families; a Rs.15,000
annual payment to every mother or guardian to prevent school dropouts;
unemployment assistance for graduates and diploma holders; loan waivers for cooperative
crop loans; and a Rs.30,000 annual transfer to weaver families. While the
fiscal deficit is currently low, these promised sops are projected to increase
it in the coming years.
(Business Standard)
Govt examines the IDBI
disinvestment process, bids were “not scrapped”: The Ministry of Finance is
currently reviewing the disinvestment process of IDBI Bank, with officials
clarifying that bids received earlier were “not scrapped” but temporarily put on
hold over valuation concerns. Officials familiar with the matter said the government
adopted a cautious approach after determining that the offers did not reflect
the bank’s fair value. “We took a wait-and-examine route,” a senior finance
ministry official said, indicating that the process remains active, though
paused for reassessment.
(Business Today)
Third party premiums take
the wheel in motor cover growth: TP premiums rose 9.3% in FY26,
compared with 9% growth in OD, taking overall motor insurance expansion to
about 9% on an estimated base of ?1.08 lakh crore. This contrasts with FY24,
when OD grew a stronger 17.4% against roughly 10% for TP, supported by robust
vehicle sales and pricing improvements. In FY25, OD grew at 8.1% while TP grew
at 7.8%. The latest shift comes despite no increase in regulated TP premium
rates since the pandemic.
(Economic Times)
RBI cautions against
misleading campaigns promising loan waivers: The Reserve Bank on Monday
cautioned the public against unauthorised and misleading campaigns promising
loan waivers, and asked them to refrain from associating with such individuals
or entities. "RBI has observed, with
serious concern, the continued occurrence of such campaigns, through various
media channels and direct outreach, by certain individuals and entities,"
the central bank said, reiterating a similar caution it had issued in December
2023. Such campaigns not only
mislead the general public but also interfere with the orderly functioning of
the credit system of the country, it said.
(Economic Times)
GST
Rationalisation impact: Share of high-value health policies doubles: Share of high-value health insurance
policies, with sum insured from Rs.20 lakh to over Rs.1 crore, has more than
doubled in the last eight months since the central government rationalised
goods and services tax (GST) rates from 18 per cent to zero per cent for
individual policies. According to industry experts, the GST rationalisation has
increased affordability for customers amid elevated medical costs. According to
Policybazaar data, the share of health
insurance policies worth Rs.20 lakh to Rs.1 crore has risen from 11 per cent
before the GST changes to 16 per cent currently, while share of policies worth Rs.1
crore and above has increased from 2 per cent to nearly 12 per cent. The share
of both put together has increased from nearly 13 per cent to 28 per cent.
(Business Standard)
NSE launches electronic
gold receipts trading: The NSE has launched trading in Electronic Gold
Receipts with physical gold as underlying commodity. NSE has dematerialisation
Gold bar (1000 grams) into an Electronic Gold Receipt, symbolising the seamless
conversion of physical gold into a secure, tradable electronic instrument in
the regulated ecosystem. EGRs empower investors to participate in the gold
market even in smaller denominations, providing improved liquidity and
flexibility comparable to other financial instruments held in demat form.
(Business Line)
NCLAT dismisses Vedanta plea
against Adani’s Jaiprakash Associates bid, upholds NCLT order: The National Company Law Appellate Tribunal
has dismissed Vedanta's challenges against Adani Enterprises' winning bid for
Jaiprakash Associates. The tribunal upheld the National Company Law Tribunal's
approval of Adani's resolution plan. Creditors chose Adani's offer based on
multiple factors beyond just the highest bid.
(Economic Times)
Sebi flags GST hurdles in
commodity market, seeks IGST mechanism: The Securities and Exchange Board of India
(Sebi) is engaging with the government to address challenges for the
commodities market, including those around goods and services tax (GST),
chairman Tuhin Kanta Pandey detailed on Monday. Pandey stated that Sebi has
flagged problems to the Department of Revenue, which the regulator wants the
GST Council to consider to find solutions to issues in physical delivery in
commodity derivatives.
(Business Standard)
Direct tax collections rise
5.12% to Rs.23.4 lakh cr in FY26; gross mop-up at Rs.28.11 lakh cr: India’s direct tax collections
for FY 2025–26 recorded steady growth, with net collections rising 5.12%
year-on-year to Rs.23,40,406 crore as of March 31, 2026, according to data
released by the Central Board of Direct Taxes (CBDT). The figures reflect
sustained revenue momentum despite moderation in refund outflows. Gross direct
tax collections stood at Rs.28,11,936 crore, marking a 4.03% increase compared
to Rs.27,03,107 crore in FY25. The growth was driven by higher inflows from
both corporate tax and non-corporate tax segments, indicating stable compliance
trends and economic activity.
(Business Today)
SEBI proposes
alignment of securitisation norms with RBI framework: SEBI has proposed a series of amendments
to its securitised debt regulations to align them with the Reserve Bank of
India’s 2021 framework for securitisation of standard assets, particularly for
transactions by RBI-regulated entities. The regulator has proposed allowing
single-asset securitisation for RBI-regulated entities by exempting them from
the cap of 25 per cent of the asset pool for a single obligor as it “restricts
listing of SDIs where the underlying comprises a single asset.” The existing rules
restrict listing of such instruments, even though they are permitted under the
latest RBI framework. SEBI has also proposed removing restrictions that
currently prevent securitisation transactions between entities within the same
group, provided the originator is RBI-regulated.
(Business Line)
GIG ECONOMY
·
A gig economy is a labor
market that relies heavily on temporary and part-time positions filled by
independent contractors and freelancers rather than full-time permanent
employees. Gig workers gain flexibility and independence but little or no job
security.
·
Examples of gig workers
include freelancers, independent contractors, project-based workers and
temporary or part-time hires. Gig apps and digital technology are often used to
connect customers and gig workers.
·
The gig economy provides
consumers with an alternative to commercial products and industries. They turn
to the gig economy for convenience, better service or both. This is the case
with ride-hailing apps, like Uber, and food delivery services, like Grubhub.
Gig apps have also met consumer demand where a service is in short supply or
expensive.
RBI KEY RATES
Repo
Rate: 5.25%
SDF:
5.00%
MSF
/Bank Rate: 5.50%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 94.9432
INR
/ 1 GBP : 129.0329
INR
/ 1 EUR : 111.3918
INR
/100 JPY: 60.5300
EQUITY INDEX
Sensex:
77269.40 (+355.90)
NIFTY:
24119.30 (+121.75)
Bnk NIFTY: 54878.50 (+15.15)
Historical
events: May 5th marks
significant historical milestones, including the 1955 Hindu Marriage Act
enabling divorce in India, the 1961 sub-orbital flight of Alan Shepard, and the
1818 birth of Karl Marx. Globally, it is recognized as International Day of the
Midwife, while in 1944, Gandhi-Jinnah talks regarding Pakistan's partition
began.
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