Inflation in India, as measured by the Consumer Price Index (CPI), spiked to a 15-month high of 7.44% in July 2023. This surge was driven by elevated food and vegetable prices. Notably, the July CPI reading exceeded the Reserve Bank of India’s upper tolerance limit of 6%, marking the first time it crossed this threshold in five months. The Consumer Food Price Index (CFPI) for July also surged to 11.51%, the highest level since October 2020.
Global markets experienced a day of declines on Tuesday, with Wall Street recording a sharp drop. These losses were prompted by discouraging data from China, which raised concerns about the state of the global economy. China’s recovery from COVID-19 restrictions faced setbacks significant enough that the country unexpectedly reduced a key interest rate on Tuesday. Additionally, China skipped releasing a report on the unemployment status of its younger workers.
These developments reflect the ongoing challenges and uncertainties faced by the global economy and financial markets, with factors such as inflation, economic recovery, and central bank policies influencing market sentiment and direction.
The Indian market opened under pressure, with the Sensex dropping by 200 points and the Nifty declining more than 50 points at the opening. At the start of the trading session, Finance and Bank stocks experienced a decrease, while IT stocks showed gains. Specifically, HDFC Bank and Bajaj Finance witnessed a 1% drop, while Infosys and ITC recorded gains. These early movements suggest a mixed and volatile start to the trading day, with different sectors reacting to various market factors and news developments.
