Wednesday, March 11, 2015

VenuG Presents: #VenuKiClass Macroeconomic Indicators A Study into Current Account Deficit A Constantly Edited Post

There are three major reasons for this post.
1 My surprise at rising current account deficit (CAD) in India.
2 Qualitative Easing(QE) implemented by European Central Bank(ECB).
3 Mystery when Janet Yellen would cut US FED interest rate. 
There are five(5) minor reasons.
1 RBI Rate cut twice by Governor Raghuram Rajan both 25 basis points, outside policy review.
2 Bombay Stock Exchange (BSE) S&P Sensex fall by 604 points on Monday 9th March, 2015.
3 Rising Dollar against Euro(€) , INR(₹).
4 Fall of Dow Jones Industrial,(354 points/1.87%) NASDAQ & S&P index between 1.65-1.87% at NYSE, on Tuesday , 10th March, 2015, wiping off the entire 2015 gains 
5 Rumours doing the market, that some corporate entity or sovereign state is about to default repayment of debt , hence buying US $ recklessly Pushing up $ to 
$1 = ₹ 62.88021
$1 = € 0.93702(all time high.) 12 year low for €!!!

$1=€ 0.93702
This set me up to do a serious in depth study of macroeconomics with focus on India, but cross border capital movements, studying Germany, US, China, Japan & Europe. This may take a week, I shall keep editing this post, so keep reading it daily for a fortnight. Sorry, My work as a Banker impedes on my time on research am pretty busy ATM. 
Today morning, I concentrate on international Crude prices & CAD between 2012 to 2015, trying to analyse why in spite of drastic fall in crude prices, India's CAD went up. What is key reason for this increase? Flight of Capital/Divident payouts/Imports / Gold Purchase?
What? Seriously I'm puzzled like a fool!!
Before I do, please read a KotakSecurities NOTECAD
Which today sounds funny . IMHO
Finance Minister P Chidambaram, was much better than, Yashwant Sinha, Pranab Mukherjee & Arun Jaitley(Gold curbs) in managing India's Currency & CAD. 
This chart will prove it 
See the CAD 2012-2015

You see above CAD came down from peak 31857 to 5137 thanks to PC & now is 8200+ After rising to 10000 Crores odd $s
Now compare the above with Crude Oil prices 2012-2015

Crude from $145 to $49!!! WT@#£%!!!
Read here all commodities down!! SEE!!!