Making Sense

Risk sentiment is off to a perky start with Equities in the green and Bond yields lower after the FOMC Rate decision.  USD Index closed near the opening levels of 106.67 after peaking at 107.11. We have a Gravestone Doji on the USD Index charts.  On US Yields, US10s broke below the 4.80% - 5.00% consolidation and treasuries closed at the best levels on the day. US2s closed near the best levels on the day at 4.94% (-14 bps) with resistance seen at 4.92%. US2s10s spread closed at -23 bps. FOMC kept the interest rate unchanged at 5.25%-5.50% and the stance restrictive while noting the resilience of the US economy (Q3 GDP 4.9% yoy), rebalancing of the labor market(+266K 3m average), encouraging inflation prints (PCE 3.40% , Core PCE 3.70%) and tightening of financial conditions. The outlook is beset with uncertainties as the lagged effects of monetary policy work through the system and the recent tightening in financial conditions weighs on economic activity. The Fed will be in a ...

  India's manufacturing sector posted a remarkable performance at the end of the final fiscal quarter, as growth of factory orders and production quickened to the strongest in three months. With pressure on supply chains subsiding and raw material availability improving, input cost inflation retreated to its second-lowest mark in two-and-a-half years . Subsequently, goods producers concentrated on rebuilding their stocks. Robust increases in buying levels in recent months supported a near-record accumulation of input inventories in March. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index rose from 55.3 in February to 56.4 in March , signalling the strongest improvement in operating conditions in 2023 so far. That said, the PMI average for the final fiscal quarter (55.7) came in below that recorded in the prior period (56.3 in Q3). March GST collections rose 13% yoy to INR 160,000 crs, second highest since July 2017. The Services PMI will be rele...