Devil Lies in Details
The US Federal Reserve has continued to maintain its accommodative stance. And kept its benchmark interest rate close to zero.
The Fed has also ensured the continuity of easy monetary policy in the short term future. But, it also hinted at a possibility of at least two interest rate hikes in 2023. It is a year earlier than what was forecasted in the March meeting.
The policy clearly indicates that liquidity flow will continue uninterrupted for the time being. However, the federal reserve has started thinking on the lines of tightening the monetary policy.
The Federal Reserve has, in fact, pushed rate hikes a year ahead, which shows that it is satisfied with the recovery in the US economy. And liquidity squeeze could come earlier than expected. Stock markets across the globe, including India, could react adversely to this development.
Buzz Around Covovax
The Serum Institute of India (SII) is going to launch a new vaccine - Covovax in India, by September.
Covovax is the version of US firm Novavax’s COVID-19 vaccine candidate. And SII has even secured the supply of raw materials from the US to commence production. Covovax was initially expected to be launched in June, but it got delayed due to raw material shortage.
The SII is also planning to start clinical trials of Covovax for children from July onwards. The vaccine has already generated promising results in other countries, and it makes Covovax even more special.
India's exports have recorded yet another jump as they rose by 46.43% to $14.06 billion during the fortnight ending June 14. Engineering, gems and jewellery, and petroleum products have been the major contributors behind the rising exports. Imports also increased by 98.33% to $19.59 billion during the period.
The UAE, US, and Italy were the major export destinations with rises of 84.7%, 40.4%, and 171%, respectively. Iraq (342%), Saudi Arabia (356%), and China (47.6%) were the major importers of India during the first two weeks of June.
Rising imports is a positive sign considering India’s dependency on imported raw materials for industrial activities. Iraq and Saudi Arabia are the major crude suppliers. A sharp rise in imports from these countries clearly indicates rising demand for crude, which in turn is a crucial indicator of pick up in activity levels in the country.