Review
and Outlook:
It has
been a mixed quarter of sort for the Indian market. Most of the consumer driven business
disappointed right from automobiles to FMCG.
Prolonged inflation combined with bad policy making by the Indian
government seemed to have taken its toll now on the Indian consumer. India continues to grapple with high Current
Account Deficit and a falling rupee. Government has done what it does best that
is to increase the import duty on Gold.
Instead of ensuring that it improves its export where rupee has depreciated,
government of the day is concentration on cutting down on imports and therefore
the increase in gold import duty. Time
will tell if that works. I recently saw
the Finance Minister of India saying gold is another commodity that
glitters. I do not understand why then
the central banks including the RBI buy gold from time to time. If gold is just another shining commodity why
would the US hold so much gold (8500 tons plus) in Fort Knox and then guard
it. Why that any other commodity is is not
guarded and cherished so much by any central banks. Hope our Finance Minister gives some
explanation. I would be interested to
know how much gold his family possess J being a South Indian myself.
