India Economy: Adverse base-effect starts now

Softer core to the rescue

Inflation based on the consumer price index (CPI) dropped a mild 15 basis points (bps) to 4.87% in October from 5.02% in September 2023, led by a broad-based decline in core and fuel inflation. Food inflation remained steady despite mixed underlying trend.

The decline in core inflation (to 4.3% from 4.5% in September) was a result of lower input-cost pressure on producers and, hence, on retail prices. Food inflation was steady - as vegetable prices softened, while pulses prices hardened - near 20% and cereal price inflation remained at ~11%. Spices hit 23%. Meanwhile, fuel inflation declined mildly, as it benefitted from a drop in retail LPG prices.

For the December quarter, we expect food inflation to soften, because of the government intervention and as the kharif harvest enters the market. Oil prices remain an unknown and could potentially play a spoilsport, if the Middle East conflict escalates. An adverse index base (inflation had seen a drop in the year-ago period) will somewhat restrict the downside in inflation for two months. Understand the inflation trends in detail, in the latest CRISIL report.

Global BFSI: FRTB implementation status across APAC

The first half of 2023 saw significant progress in the implementation of Basel III reforms, with particular emphasis on the revised market risk capital framework - the Fundamental Review of the Trading Book (FRTB) regulation. While India and China have published consultation papers on FRTB, regulators such as the Hong Kong Monetary Authority (HKMA), Japan’s Financial Services Agency (FSA) and the Australian Prudential Regulation Authority (APRA) have revised their initial expected FRTB implementation timelines. Download's CRISIL's whitepaper to understand FRTB implementation across the Asia-Pacific (APAC) region.?

Commercial real estate: US commercial real estate lending- Challenges and opportunities amid rising rates

CRE loan maturities by property type

The current commercial real estate (CRE) lending landscape has been shaped by government funding during the Covid-19 pandemic and relaxed credit standards in the past decade. ?Emergency financial support injected substantial capital into the markets, not only bolstering the CRE sector but also boosting liquidity and risk appetite. Concurrently, easing credit standards facilitated access to financing, fueling CRE investments.?Unlock insights on navigating the new normal.

Global BFSI: Generative AI in financial services- Pondering possibilities and pitfalls

Generative artificial intelligence (Gen AI) has become the topic du jour in recent years, permeating corporate boardrooms and reshaping industries. OpenAI's ChatGPT, among others, has further shifted the horizon. Many industries, including financial services - the traditional bastion of data-driven decision-making, are making rapid strides in harnessing Gen AI’s possibilities.?Read CRISIL's blog as it unpacks both sides of this revolutionary technology, within the realm of financial institutions.

India BFSI: NBFCs expected to see assets grow 14-17% next fiscal ?

Assets under management (AUM) of non-banking financial companies (NBFCs) are set to log a healthy 14-17% growth next fiscal on the back of continued strong credit demand across retail loan segments. Growth may be moderately lower than 16-18% expected in the current fiscal (see annexure), as unsecured retail loans, the fastest growing segment in the NBFC AUM pie so far, are likely to see a relatively slower growth as NBFCs recalibrate their strategies due to the recent regulatory measures issued by the Reserve Bank of India (RBI). Understand more on the sector's growth.

Explore More:

Our Blogs | Our Insights | Our Events | Our Podcasts | Join our Team