Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Lowest credit growth disproves economic recovery claims
Fri, 19 Sep Pre-Open

It's a favorable change of season for Indian equity markets... from almost a hopeless scenario to Sensex touching new highs. Much of this turn in sentiments can be attributed to the confidence Modi Government has instilled in people. People expect reforms, development and a turn around in the Indian economy now.

But has anything really changed on the ground level? Some of the key economic indicators do not suggest so. As highlighted by The Hindu Business Line, banking credit growth of 10.9% has hit the lowest level in last five years; lower than even the worst phases in the Indian economy. The sector itself has been a victim of the prolonged slow down in the Indian economy. During the slowdown, investment activity by companies has taken a back seat. Lot of projects are still stalled due to the issues like lack of clarity on policies, land availability, power and labour issues. Unless strong action is taken regarding these aspects, new projects are unlikely to be undertaken, leaving less hope for revival in the credit growth rate.

And it's not just the lack of demand that is in play here. The increase in bad assets in the banking sector and focus on better risk management has made banks wary of extending loans. High inflation is another reason why credit growth is likely to remain low. Unless inflation levels in the economy come down, interest rates are unlikely to be lowered, thus impeding the growth rate in credit offtake.

In such scenario, can we really claim that an economic recovery is in sight? We don't think so. Unless Government takes some tangible and quick actions. to revive the investment cycle! And while there is a lot of optimism in this regard, the actions seem to be lagging far behind.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary

What else is happening in the markets today? Dig in...

Equitymaster requests your view! Post a comment on "Lowest credit growth disproves economic recovery claims". Click here!


Views on News

BSE Sensex Surges 1,060 Points; TATA STEEL Among Top Gainers (Market Updates)

Mar 3, 2021 | Updated on Mar 3, 2021

The BSE Sensex Surged 1,060 Points; TATA STEEL Among Top Gainers. Find the latest update, special reports and news on all time high gainers of BSE Sensex at

My Latest Stock Recommendation (Fast Profits Daily)

Oct 9, 2020

How I picked an exciting stock using trends from both the commodity and equity markets.

Data is the New Oil but It's Also the New Sugar. Here's How to Fight it (Profit Hunter)

Jun 1, 2020

Is too much data hurting your quest for market beating returns?

Quantum Mutual Fund: Hum woh nahi hain (The Honest Truth)

Apr 29, 2020

Ajit Dayal on how the mutual fund industry robs you of your wealth.

This One Trigger Could Turnaround Yes Bank's Stock Price (The 5 Minute Wrapup)

Oct 16, 2019

If Yes Bank manages to do this, it could be the start of a much-needed turnaround for the bank.

More Views on News

Most Popular

It's the Beginning of a New Bull Phase in Smallcaps (Profit Hunter)

Feb 24, 2021

Last time the smallcap index crossed 19k a big correction followed. Here's what makes it different this time.

Make Rs 5,000 Per Day Trading the Market (Fast Profits Daily)

Feb 25, 2021

In this video, I'll show you how to get started on the path to daily trading profits.

I Believe the Investment of the Year Will Be...

Feb 19, 2021

In this episode, ace trader Brijesh Bhatia talks to us about the best investments of 2021, his profitable trading system, and much more.

The Hidden Tesla in My Great Indian Wealth Project (Profit Hunter)

Feb 23, 2021

An Indian company founded three decades ago in a garage caught my attention...


India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms