India big beneficiary of Chinese deflation: Ed Yardeni
Ed Yardeni, the President of Yardeni Research, outlined key factors contributing positively to the Indian markets including the role of China.
India is a significant beneficiary of the deflationary trends emanating from China, said Ed Yardeni of global economic analysis firm, Yardeni Research.
“I think we're checking all the boxes, we're seeing that inflation is moderating worldwide and in India because oil prices are down.... The one thing that still is not in favour of emerging economies generally, is weak commodity prices, but India is not a major exporter of the kind of commodities that matter for the economies of China or others....And then of course the political stability issue got checked as well. So it's looking pretty good (for India),” Yardeni noted in a chat with CNBC-TV18.
Deflation refers to a reduction in the overall price level of goods and services.
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In early December, Moody's Investors Service, a leading global ratings agency, revised China's credit rating outlook from "stable" to "negative." The decision was influenced by anticipations of diminished medium-term economic growth and concerns about a significant downturn in the expansive property sector of the country.
The rating agency expects the country’s annual gross domestic product (GDP) growth to be 4% in 2024 and 2025 and an average 3.8% from 2026 to 2030.
In its latest Global Economic Outlook report for India released in November, Fitch noted that the Indian economy has the highest potential among the top 10 emerging economies. The rating agency forecast an annual average growth rate of 6.2% in the medium term for the country during the 2019-27 period.
Moody's decision on the China downgrade came just a day after S&P Global, another investment rating agency, pointed to challenges faced by China both domestically and internationally, highlighting the particularly concerning "deteriorating property crisis."
To view the complete interview with Ed Yardeni, please watch the accompanying video.
(Edited by : Shweta Mungre)
First Published: Dec 11, 2023 11:38 AM IST
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