Domestic Fiscal Data reaches a scary 80% or $76B
India’s current account Deficit for Q3 will be under watch as Q2 data grossed a magnificent 5.4% at the peak of Gold import concerns and a rising quantum of imports despite a struggle for Oil prices and ‘imported inflation’ finally lost to the wind consequently.
The Q2 CAD was $22.3 bln from $16.6 bln and $18.9 bln in June 2012 and September 2011 respectively. The Fisc meanwhile is unlikely to get in control despite a last minute turn down of discretionary expenditure plans by the PlanCom in a meeting with P Chidambaram on New Year’s Eve
Data for the Fisc was released for April – November period after tax collections data last week showed an uptick of 15% overall in both Corporate and Personal tax (Advance Tax Payments – Direct Income Tax)
The April – November Data showed a deficit of INR 4.13 tln with Net Tax receipts of INR 3.7 tln and expenditure of INR 8.7 tln
US announces a two month plug
The republicans and the recalcitrant Democrats in the Senate have agreed to a truncated deal to avoid the steep impact of the Fiscal cliff of $630 B in cuts that outweighs the YOY GDP growth in 2011 by a $100 odd billion. This plug will avoid withdrawal of tax benefits and introduces limited tax increases for Americans earning probably more than $500k per year to avoid the AMT impact of $4000 which will bite if the Fiscal cliff is indeed implmented and a final deal falls through ithin the current ‘grace period’
The plug would need to be cleared by both the Senate and the Congress and then signed into law.
India PMI data due
The manufacturing PMI is released for India on Wednesday and the Services PMI which has been encouraging global players on Friday. China PMI data hit a record 18 month high of 51.5 in the HSBC PMI release yesterday with the Official PMI also hitting 50.6