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Maneesh Dangi, the Founder of Macro Mosaic Investing and Research, highlights the current cyclical slowdown in the economy. He notes that the majority of earnings are likely to disappoint in this environment, as the slowdown is evident. Typically, such slowdowns last for 5-7 quarters and do not recover without policy stimulus. Historically, the pattern of slowdown and recovery is well-known. Maneesh Dangi points out that public debt to GDP has not decreased, making a major fiscal splurge unlikely. Additionally, outright monetary easing is challenging from the Reserve Bank of India's (RBI) perspective. However, he sees liquidity easing and soft regulatory unwind as positives that could ease some pressure.
He also mentions that Federal Reserve Chair Jerome Powell has returned to a hawkish stance, which limits India's ability to pursue an easy policy.
#budget2025 #economy #indianeconomy #rbiratecut
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