JPMorgan says agricultural prices are poised to experience a notable rise in India

India is witnessing the impacts of El Nino and a related shortfall in rain. If one holds the belief that agricultural prices will not escalate given this scenario, he/she is likely perceiving a distinct reality. The data have indicated that agrarian prices are set to rise.

In an interview with CNBC-TV18, Jahangir Aziz, Global Head-EM Economics at JPMorgan, said that agricultural prices are poised to experience a notable rise.

He said, “You have Ei Nino, you have a monsoon rain shortfall and if you do not expect agricultural prices to rise, you must be living in a very different reality. So yes, the agricultural prices will rise, but look at the core inflation, it went down from 5.4 percent to 5.2 percent if my recollection is right.”

Also Read: RBI MPC increases FY24 inflation forecast to 5.4% from 5.1%

This decrease can be ascribed to the favourable influence of robust export deflation originating in China. This deflation is not solely suppressing disinflation within global goods markets but is also exerting a moderating impact on core inflation within India. This pattern is anticipated to endure for the subsequent 3-4 months owing to the persistent deflationary circumstances prevailing in China.

Talking about emerging markets, Aziz said that emerging markets are displaying the impressive strength that they have exhibited over this year. Virtually all economists (at JPMorgan) in various countries are revising their growth predictions upward for the majority of these economies. Consequently, we are stepping into a scenario where both the United States and emerging markets excluding China are poised for a substantial level of success.

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