WPI inflation for June 2022 was relatively lower at 15.18% compared to 15.88% in May 2022. This was driven by lower crude and minerals and also partially attributable to the hawkishness of the RBI. However, this is the third successive month that WPI inflation has stayed above 15%. Food inflation, which has a 24.4% weight in the WPI basket has gone up 152 bps to 12.41% in June 2022. Manufactured products with a weight of 64.2% saw WPI inflation tapering from 10.11% to 9.19%. RBI is likely to hike
rates in August.
Brent crude fell by more than $4 to $95.52/bbl as traders got jittery that the US Fed may hike rates by 75-100 bps in its July FOMC meet. The US WTI crude also fell sharply to $91.63/bbl. This is their lowest level since 23rd February. Oil prices have fallen sharply on fears that the hawkishness of the Fed may result in recessionary conditions. US consumer inflation came in at a 41-year high of 9.1% for the month of June 2022. The first signs of recession are that China’s daily crude imports sank to the lowest since
July 2018.
Reliance and ONGC gained 2% amid reports that the government may lower the windfall tax on oil. The profits of fuel exporters and oil producers have fallen sharply due to the crash in global crude prices. On Thursday, while Reliance gained 2.4%, ONGC was up 6.4%. This refers to the windfall tax that government had imposed on crude output and oil exports amid high international oil prices. The levy was Rs6 per litre on petrol exports, Rs13 per litre on diesel exports and Rs23,250 per tonne of crude oil produced in India.
Merchandise exports for June rose 23.52% to $40.13 billion while trade deficit touched a record $26.18 billion on account of a spike in gold and crude oil imports. Exports grew 20.55% yoy, while imports were up 57.55% yoy. June crude imports doubled to $21.3 billion as did coal and coke imports to $6.76 billion. Cumulative exports for April-June period were up 24.51% at $118.96 billion while imports were up 49.47% to $189.76 billion. Exports of textiles, rice, oilseeds, tea, engineering and dairy recorded robust growth.
Israel announced it will sell Haifa Port, a major trade hub on its Mediterranean coast, to Adani Ports and Israeli chemicals and logistics group, Gadot, for $1.18 billion. The sale was done at the end of a 2-year
tendering process. This is expected to lower import prices and shorten long wait times at Israeli harbours. While Adani will have a majority 70% stake, Gadot will hold 30%. This gels with Adani Ports’ plan to emerge as a premier global port company. Nearly 98% of all the goods move in and out of Israel via the sea route.
Enforcement Directorate (ED) arrested, Chitra Ramkrishna, in a money laundering case linked to illegal phone tapping and snooping of employees. The ED has taken permission from the court to interrogate her through 9-day custodial interrogation. ED had also filed the case under PMLA against former Mumbai Police Commissioner Sanjay Pandey. According to CBI, Ravi Narain and Chitra had roped in a company founded by retired IPS officer Pandey to snoop on NSE employees by illegally intercepting their voice calls.
Temasek Holdings of Singapore has seen its exposure to India climb to a record $16 billion in FY22 despite a broader market correction. Apparently, Temasek continued to augment its investments in technology firms and other listed companies. Temasek has seen its total India portfolio double in last 5 years. The overall portfolio of Temasek globally stands at a robust $400 billion. Interestingly, Temasek has a stake in Zomato, Policybazaar, CarTrade and Devyani International; all of which went public last year via IPO route.
Microsoft has been cutting to realign business groups and roles. It plans to finish the current year with a total headcount of 180,000. However, the lay-offs are likely to impact less than 1% of its workforce.
Some of the role eliminations were in consulting and customer & partner solutions. Meanwhile, even Google has decided to go slow on hiring this year in the face of rising recession uncertainty. Pichai however added that at the end of the year they would see an expansion of the workforce. Google
employs 164,000 people.
