Posts tagged Central Bank

Asia’s Economic Growth: Spotlight on India

According to a recent poll from Reuters, it appears that economic growth in India has witnessed an escalation in the first quarter of 2013. This is particularly good news for the Asian region given that it has encountered quite a substantial low in the last quarter of 2012.  This report indicates that India could be on the upswing, moving away from its downward spiral.

However, there is still much work to be done vis-à-vis strengthening India’s economy.  Indeed, according to economist Kruti Shah, this recent statistic is “only a marginal improvement with much of the support from a slight recovery in the manufacturing sector and better trade data in this quarter compared to the previous quarter.”   However, given that there has been somewhat of a recovery in the country’s exports, factories and investments, this had a positive, noteworthy impact on the performance of the overall economy. There was a slight increase in capital goods output as well as exports which saw an escalation from levels during the same time period as 2012.

Economists and financial predictors must still be aware of India’s current account deficit that witnessed an all-time high in the last quarter of 2012 and still today remains under substantial pressure. But simultaneously, inflation dropped below 5 percent in April 2013, which puts it in the Central Bank’s comfort zone for the first time in over three years.

traducción español

Crecimiento en la economía de Asia: con Foco en la India

De acuerdo con una encuesta reciente de Reuters, parecería que el crecimiento de la economía en India ha sido testigo de un crecimiento en el primer cuatro del 2013. Esto en particular es una buena noticia para Asia, ya que había sufrido una considerable baja el último cuarto del 2012. Este reporte indica que Inda podría estar en una fase de expansión, alejándose del espiral descendente.

De todas formas, todavía hay mucho trabajo que hacer de cara a fortalecer la economía de la India. En efecto, de acuerdo con Kruti Shah, estas estadísticas recientes “solo una mejora marginal se ha dado con mucho apoyo y una pequeña recuperación del sector industrial y mejores datos comerciales comparado con el cuarto de año anterior.”   Sin embargo, dado a que ha habido una pequeña recuperación en las exportaciones del país, fábricas e inversiones, esto ha tenido un notorio impacto positivo en la economía en general. Hubo un ligero aumento de la producción de bienes de capital, así como las exportaciones que vieron una suba de los niveles durante el mismo período en el 2012.

Los economistas y predictores financieros deben aún estar conscientes que la cuenta corriente de la India presenció un déficit que llegó a un máximo histórico en el último cuarto del 2012 y que aún sigue bajo una presión importante. Pero simultáneamente, la inflación cayó por debajo del 5 por ciento en Abril del 2013, lo que pone al Banco Central en una zona de confort por primera vez en tres años.

English Translation

Jeffrey Lacker on Monetary Stimulus

Next week, U.S. central bankers will convene amongst predictions that 2012’s growth will not be sufficient to reduce the nation’s current unemployment rate of 8.5%. Explored options include additional monetary stimulus, as well as having the central bank loosen up on certain markets.

Jeffrey Lacker, President of the Federal Reserve Bank of Richmond, sees no reason to institute either of these measures unless the economy encounters severe inflation or a dramatic growth slump. “I am still where I was a month or two ago when I said I didn’t see a compelling case for further stimulus,” he said. “The record of the last year and a half is that stimulus raised inflation and didn’t do much for growth on a sustained basis. And I think if we did it again, that is what would happen.”

He continued, stating that this year should bring “more modest expectations for monetary policy.”

“My takeaway from 2011 is the lesson that the impediments to more rapid U.S. growth are likely to be deeper and more persistent than we thought a year ago,” Lacker added. “I am expecting only a modest improvement for 2012.”

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