Breaking News

You are here » Indian-Commodity  :  Top News  :  Room for India's fiscal policy easing constrained by high debt burden: Moody's


Room for India's fiscal policy easing constrained by high debt burden: Moody's

Credit rating agency Moody's in its latest report Sovereigns - Brexit and Asia Pacific: Limited Direct Credit Impact; Some Sovereigns Exposed to Market Volatility', has said that in India the room for fiscal policy easing is constrained by high debt burden, but it also said that Britain's exit from the European Union will not have any significant credit impact on the Asia Pacific region and the sovereigns' exposure to external financing is limited for India.

Moody's in its report said that over the coming months, announcements related to Brexit could trigger financial market volatility in Asia Pacific sovereigns. It added that a shift in portfolio and/or banking flows that resulted in tighter financing conditions in some Asia Pacific markets would hurt growth, especially in countries where fiscal and monetary policy space is constrained.

Furthermore, Moody's said that where there is room for monetary and/or fiscal policy easing, the domestic authorities may take actions that would partially offset the negative shocks. It added that unless currencies depreciate significantly and stoke inflationary pressures, moderate inflation provides space to lower policy interest rates and ease domestic financing conditions.

The rating agency in its report cited that India's exports to UK were 0.4 per cent of the GDP in 2015 while shipments to European Union make up for 1.7 per cent. It said that India's GDP growth is likely to face challenge in next two years, due to sluggish global demand, high leverage in some corporate sectors and impaired credit supply.

Related News

View all news

Crude oil futures end lower on Monday

Crude oil futures ended lower on Monday as steep declines in the US stock market fed an aversion to so-called riskier assets, which include oil. Meanwhile, the US-China trade dispute escalated as China......

Gold futures trade flat on Monday

Gold futures was trading flat on Monday as growing uncertainty over whether the United States and China will be able to reach a deal to end their escalating trade war fueled safe-haven demand for the precious......

Jeera futures trade higher on rising demand

Jeera futures traded higher on NCDEX on the back of rising physical and export demand at the spot market. However, higher availability of crop this season, capped some gains.The contract for May delivery......

Top News

View all news

SRF, NIIT Technologies and United Bank of India to see some action today

SRF has entered into a definitive agreement to sell its Engineering Plastics Business to DSM, the Life Sciences and Materials Sciences Company in an all-cash transaction, amounting to Rs 320 crore. The......

NIIT Technologies concludes sale of 88.99% stake in ESRI India Technologies

NIIT Technologies has concluded the sale of 88.99% equity shares in ESRI India Technologies, India to Environment Systems Research Institute Inc., USA. Consequent to above sale, ESRI India Technologies,......

United Bank of India to raise Rs 1,500 crore by various means

United Bank of India has received approval to raise equity capital not exceeding Rs 1,500 crore in one or more tranches during the financial year by way of Qualified Institutions Placement, Public Issue,......