homemarket Newsstocks NewsIndia remains a good defensive bet in current global environment, says Geoffrey Dennis
India remains a good defensive bet in current global environment, says Geoffrey Dennis
The US Federal Reserve left its lending rates unchanged at 2.25-2.5 percent but indicated easing going ahead. Adrian Mowat, an emerging equity markets strategist, and Geoffrey Dennis, emerging markets commentator, spoke about the US economy and emerging markets.
The US Federal Reserve left its lending rates unchanged at 2.25-2.5 percent but indicated easing going ahead. Adrian Mowat, an emerging equity markets strategist, and Geoffrey Dennis, emerging markets commentator, spoke about the US economy and emerging markets.
"Chances of Fed cutting rates are incredibly low despite what the bond market is predicting," Mowat told CNBC-TV18 on Thursday.
“The US economy is strong, it is generating jobs. The consumer data remains robust. We did see a deterioration in the business sentiment data which was primarily focused on the trade dispute with China plus Trump threatening to put 5 percent tariffs on goods coming in from Mexico,” he added.
On the emerging markets, Mowat said, “We are seeing volatility in emerging market equity performance and ultimately it’s to do with the domestic dynamics.”
“India has had superior, more consistent domestic dynamics than the other big emerging market and is tended to have relatively consistent flows and investors focusing on relatively expensive but high-quality consistent growth companies,” he said.
With regards to the US economy, Dennis said, “The US economy is perhaps a little weaker than Adrian is indicating. He is right that the case for a rate cut now is very weak indeed. There is no reason for even the insurance rate cut as it seems to be called these days.”
“The economy is reasonably okay at the moment, it can weaken going forward, inflation is low and the bond yields below 2 percent tells something about what the market thinks about where the economy is headed,” he added.
On India front, Dennis said, “There are concerns about the budget deficit. There have been enough for quite some time and they will probably remain.”
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