The global markets have fared mixed with most of the Asian indices closing on a positive note whereas the European indices have opened on a weak note. The rupee was trading at Rs 62.39 to the dollar at the time of writing.
A leading financial daily states that Barclays has lowered the India's GDP forecast for FY14 to 4.7%. The company believes that the growth and the fiscal health of the nation have gone for a toss. Moreover, the upcoming 2014 elections have added to the woes.
India's economic growth had slumped to decade low of 5% during 2012-13. Manufacturing and mining sectors were largely responsible in pulling down the growth. Also, the uncertainties surrounding the elections are expected to create hurdles for the revival of investment cycle. This would further weaken the fiscal health of the nation. Moreover, the recent repo rate hike from the new Governor indicates money won't be cheaply available going forward. Given that the inflation continues to remain at higher than comfort levels, possibility of further rate hikes cannot be ruled out. Not just that. India has also been battling with currency instability for quite some time now. This is another important agenda for the Reserve Bank of India (RBI).
Except few such as Eicher Motor, Mah. Scooters and Hero Motocorp, most of the Automobile shares closed in red today. Stocks such as Maruti Suzuki and Force Motors faced the maximum selling pressures. According to leading financial news daily, Mahindra and Mahindra, the auto giant has decided to increase the prices of its passenger as well as its commercial vehicles by 2% with effect from 1st October 2013. The company in its statement said that the price hike would fall in the range of Rs 6,000 to Rs 20,000 depending upon the vehicle model. The price hike comes on the back of higher input costs, devaluation of rupee and increase in raw-material costs. Mahindra and Mahindra had for quite some time held back the price increase. But increased costs in recent periods have prompted the company to take this step. Nonetheless, the company continues to remain committed to its customers.