Every Monday, Mint’s Plain Facts section features key data releases and events to look for in the coming week. The Reserve Bank of India (RBI) will hold the first monetary policy meeting of the fiscal year amid global uncertainties. Data on how business activity fared in March is due this week. France is holding presidential elections and the medical community will observe World Health Day. This is what to look out for:
The RBI’s monetary policy committee (MPC) meets this week, with an announcement due on Friday. In February, most analysts had expected the panel to shift its focus from growth to inflationary pressures, but that did not happen. The backdrop since then has worsened. The US Federal Reserve has embarked upon rate hikes and Russia’s invasion of Ukraine has pushed crude oil prices above $100 per barrel. However, RBI governor Shaktikanta Das remains dovish and analysts do not expect a major shift in the upcoming meeting as well, considering the growth risks that have also emerged from the war. With retail inflation rising above 6% in January and February, the MPC may choose a wait-and-watch policy before it changes its stance and hike rates by 50-100 basis points over the year, according to analysts. All eyes will be on revisions in inflation projections and whether the MPC would continue to view elevated inflation as “transitory”.
India’s manufacturing and services Purchasing Managers’ Index (PMI) saw an improvement in February following slowdown in activity in January because of the third covid-19 wave. However, the risks of inflationary pressures and supply shortages remained and may have deepened in March because of the Ukraine crisis. The emerging risks to growth because of the disruptions on a global scale as a result of the war could hinder overseas demand. The geopolitical crisis has caused problems for India’s exports to Russia, while China’s zero tolerance policy on covid may have intensified shortage of raw material. The upcoming PMI prints, due this week, would also reveal more about domestic demand. Companies are facing input price pressures and profit margins are getting squeezed, forcing some companies to raise prices. The manufacturing and services PMI in March may get a reprieve from domestic demand offsetting risks from price pressures.
Russia is due to release its inflation data for March on Wednesday. Unprecedented sanctions slapped by the US and its European allies in response to Russia’s invasion of Ukraine have thrown the economy into disarray. To keep inflation under control and stabilize the ruble, the country’s central bank had raised interest rates from 9.5% to 20% on 28 February. However, the sanctions and trade restrictions are choking household budgets as demand has risen in anticipation that the ruble’s free fall could lead to a further increase in prices. In February, year-on-year inflation was at 9.2%, but this rose to a six-year high of 15.7% on 25 March. Inflation had been rising steadily since December. The central bank’s intervention may help limit the damage. The ruble had largely recovered to its pre-war level by the end of the month.
4.France presidential elections
Emmanuel Macron registered a stunning victory in the 2017 French presidential elections, just a year after setting up his own political party. Then a 39-year-old former investment banker, Macron campaigned as an outsider and entered office as a technocrat and reformist. This week, he is aiming to be the first French president in 20 years to win a re-election. He comfortably leads all opinion polls and his response to the Ukraine war has only cemented his position. The first round of presidential elections is due on Sunday. If no candidate gets more than 50% of the votes, as is likely, a second round will take place on 24 April between the top two candidates from the first round. Macron’s closest rival is far-right politician Marine Le Pen, who he defeated in 2017. A hardliner on immigration and a eurosceptic, Le Pen’s bet is blue-collar voters distraught with the cost of living and disenchanted with the elite.
5.World Health Day
The anniversary of the founding of the World Health Organization (WHO) on 7 April 1948 is marked as World Health Day. This year’s theme “Our planet, our health” is a timely reminder of the threat ecological degradation poses to human health. With increasing human encroachment into wild areas, the risk of zoonotic diseases such as covid-19 is on the rise. Besides, around 13 million deaths annually are attributable to avoidable environmental causes. Air pollution alone accounts for 6.7 million deaths a year and saw the highest increase in risk exposure over the last decade.
In India, it is the biggest killer, accounting for 1.7 million deaths annually. A sustainable future will go a long way in ensuring public health. An active transport system will keep us away from sedentary lifestyles while reducing air pollution, while a transition to sustainable diets can prevent chronic diseases such as hypertension and diabetes while reducing emissions.
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