Concerns over Budget math and growth as oil tops $100, markets crash

Friday, 25 February 2022newsdesk

Global crude oil prices topping $100 a barrel and singeing of stock markets following Russia’s attack on Ukraine will cast a shadow not just on India’s budget arithmetic, but also put to test the Reserve Bank of India’s deftness in continuing to support growth in the near term with inflation risks suddenly turning more grave.

New Delhi, 25 February 2022

As per news report of The Indian Express, To take stock of the evolving situation, Prime Minister Narendra Modi met Finance Minister Nirmala Sitharaman and other senior government functionaries Thursday. With economic recovery still nascent post the third wave of Covid-19, the new geo-political tensions and an extended military engagement could post hurdles to growth in India. “The PM met senior government functionaries to take stock of the situation arising from the Russia-Ukraine conflict and its impact on India,” a government official said. With surging crude oil prices, the most immediate concern is on the price front – India’s inflation rate is expected to surge higher than most official calculations. An above trend inflation print may prompt the central bank to raise policy rates ahead of schedule, coinciding with the rate hikes that the US Federal Reserve is slated to undertake early summer.

Source - The Indian Express