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Time of India
3 days ago
- Business
- Time of India
Lower wage growth impacting consumption; tax cuts and rate cuts tools to spur growth: Report
Weakening wage and job growth cycle is impacting consumption sentiment , and tax cuts and rate cuts will help accelerate momentum, according to a report by ICICI Bank Global Markets. The report highlights that wage growth for listed Indian companies nearly halved in the financial year (FY) 2025, slowing to 7.5 per cent from an average of 15 per cent year-on-year (YoY) between FY22 and FY24, impacting consumption. The deceleration in wage growth can be attributed to the tepid demand and global economic uncertainty. The report adds that the slowdown, coupled with high inflation and elevated interest rates, has eroded consumers' discretionary income, particularly in urban areas. Spending across sectors has dampened. "Lower interest rates should lead to further recovery in consumption as repo-linked loans get repriced lower and reduce the interest outgo for consumers," according to ICICI Bank Global Markets report . "We believe further monetary support is required to spur consumption when inflation is easing," it said. Backing its assertion, the report added that Fast-Moving Consumer Goods (FMCG) sales in urban centres are trailing rural markets. In contrast, passenger vehicle sales growth has sharply decelerated to 4.5 per cent in FY25 from 8.8 per cent the previous year. On the job growth front, the report added that once a strong hiring engine, the IT sector continues to grapple with demand challenges from tech disruptions, monetary tightening, and trade volatility. Net hiring peaked at 293,000 in FY22 and saw a net contraction of 70,000 by FY24. The Indian economy grew by 6.5 per cent in real terms in the recently concluded financial year 2024-25, according to the Ministry of Statistics and Programme Implementation's official data. While the economic growth was 7.4 per cent in the January-March quarter (Q4) of FY25. This was a sharp rise from the 6.2 per cent recorded in the previous quarter. Given the underlying weakness in urban demand , the government announced an income tax relief of Rs 1 trillion in the Union Budget 2025-26. The other factors favouring a consumption recovery are lower food inflation as well as the recent uptick seen in GST collections. In the last two months we have seen a visible acceleration in GST collections, with gross GST revenues increasing by 16.4 per cent YoY in May and 12.6 per cent YoY in April, respectively.
India Gazette
3 days ago
- Business
- India Gazette
Lower wage growth impacting consumption; tax cuts and rate cuts tools to spur growth: Report
New Delhi [India], June 5 (ANI): Weakening wage and job growth cycle is impacting consumption sentiment, and tax cuts and rate cuts will help accelerate momentum, according to a report by ICICI Bank Global Markets. The report highlights that wage growth for listed Indian companies nearly halved in the financial year (FY) 2025, slowing to 7.5 per cent from an average of 15 per cent year-on-year (YoY) between FY22 and FY24, impacting consumption. The deceleration in wage growth can be attributed to the tepid demand and global economic uncertainty. The report adds that the slowdown, coupled with high inflation and elevated interest rates, has eroded consumers' discretionary income, particularly in urban areas. Spending across sectors has dampened. 'Lower interest rates should lead to further recovery in consumption as repo-linked loans get repriced lower and reduce the interest outgo for consumers,' according to ICICI Bank Global Markets report. 'We believe further monetary support is required to spur consumption when inflation is easing,' it said. Backing its assertion, the report added that Fast-Moving Consumer Goods (FMCG) sales in urban centres are trailing rural markets. In contrast, passenger vehicle sales growth has sharply decelerated to 4.5 per cent in FY25 from 8.8 per cent the previous year. On the job growth front, the report added that once a strong hiring engine, the IT sector continues to grapple with demand challenges from tech disruptions, monetary tightening, and trade volatility. Net hiring peaked at 293,000 in FY22 and saw a net contraction of 70,000 by FY24. The Indian economy grew by 6.5 per cent in real terms in the recently concluded financial year 2024-25, according to the Ministry of Statistics and Programme Implementation's official data. While the economic growth was 7.4 per cent in the January-March quarter (Q4) of FY25. This was a sharp rise from the 6.2 per cent recorded in the previous quarter. Given the underlying weakness in urban demand, the government announced an income tax relief of Rs 1 trillion in the Union Budget 2025-26. The other factors favouring a consumption recovery are lower food inflation as well as the recent uptick seen in GST collections. In the last two months we have seen a visible acceleration in GST collections, with gross GST revenues increasing by 16.4 per cent YoY in May and 12.6 per cent YoY in April, respectively. (ANI)
Time of India
17-05-2025
- Business
- Time of India
Gold prices undergoing short-term correction, prices in $3,050–$3,250 per ounce range in Q2: Report
Gold prices to see market correction in short term (AI-generated image) Gold prices are expected to fluctuate between $3,050 and $3,250 per ounce in the second quarter of 2025, according to a report by ICICI Bank Global Markets , while suggesting a short-term correction of declining prices. After rising nearly 25 per cent during January to April 2025, gold prices have declined around 4 per cent over the past fortnight. The pullback reflects easing concerns over global trade conflicts and reduced safe-haven demand, following the 90-day truce between the US and China. Data from the World Gold Council (WGC) highlights strong investment demand in the first quarter of 2025, with a 170 per cent year-on-year increase. This surge was largely driven by investor uncertainty surrounding the Trump administration's policies and ongoing trade disputes. However, improving diplomatic ties have since tempered market concerns, contributing to the recent price moderation. The report also notes that the slowdown in central bank gold purchases appears to be temporary. Meanwhile, elevated prices have subdued jewellery demand, a trend likely to persist in the near term. 'We would not rule out the prospect of a mild correction setting in place in the near term, particularly if the US is able to move forward with making trade deals with the rest of the world,' the report stated as quoted by news agency ANI. In the Indian market, MCX gold prices stood at Rs 92,480 per 10 grams on Saturday. Domestic prices have remained steady, mirroring global weakness and benefiting slightly from the appreciation of the Indian rupee against the US dollar. Gold imports have also moderated, with April imports at USD 3.1 billion compared to USD 4.5 billion in March. This decline aligns with reduced jewellery demand due to higher prices. Going forward, ICICI Bank expects Indian gold prices to maintain an upward trajectory, ranging between Rs 92,500 and Rs 94,500 per 10 grams in the second quarter of 2025, with potential to reach Rs 96,000 to Rs 98,000 per 10 grams in the latter half of the year. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
India Gazette
17-05-2025
- Business
- India Gazette
Gold correction likely short-term; prices may trade between USD 3,050-3,250 per ounce in Q2 2025: Report
New Delhi [India], May 17 (ANI): The correction in gold will be short-term and prices could trade in the USD 3050/ounce (oz) to USD 3250/oz range in the second quarter of 2025, according to a report by ICICI Bank Global Markets. After a sharp rise witnessed over January-April 2025 in which gold prices rallied by 25 per cent, a correction has set in over the last fortnight as prices have fallen by 4 per cent. The report adds that the fall in prices reflects reduced anxiety about the trade war and subsequently reduced safe-haven appeal. Data released from the World Gold Council (WGC), although it is lagged, also shows the main sources of demand for gold that has been in place in the first quarter of 2025. In this regard, investment-related demand for gold that increased by 170 per cent YoY in Q1 2025 underpinned the rally in the period as investors turned to the yellow metal in the face of uncertainty about the Trump policy regime and, in particular, about the trade war. As the trade-war anxiety has eased post the 90-day truce between the US and China, the subsequent demand for gold has reduced, which has driven prices lower. Pointing out the slow gold purchases by the central bank, the report said that the trend will be short-term. Elevated prices have also hit jewellery demand, which could continue going forward, the report added. On the outlook of global gold prices, the report adds, 'We would not rule out the prospect of a mild correction setting in place in the near term, particularly if the US is able to move forward with making trade deals with the rest of the world.' In Indian markets, as per the prices at MCX, the price of gold on Saturday stands at Rs 92,480 for 10 grams. Gold prices dipped lower on Wednesday, following easing trade tensions between China and the United States, which led to a decline in safe-haven demand. Gold prices in Indian markets have traded flat responding to weakness in global prices and a mild appreciation of the INR against the USD that has taken place over the period. In volume terms, gold imports have fallen on a sequential basis as country imported USD 3.1 bn worth of gold in April, after importing USD 4.5 bn worth of gold in March reflecting an easing in jewellery demand that has taken place in response to elevated prices. Going forward, the report added that local gold prices in India are expected to continue trading with an upside bias trading in the Rs 92,500 per ten grams to Rs 94,500 per ten grams range in Q22025 and moving to the Rs 96,000 per ten grams to the Rs 98,000 per tens grams range in the second half of 2025. (ANI)
Times of Oman
29-03-2025
- Business
- Times of Oman
Tariff uncertainties to keep gold prices in India between Rs 87-90K range in H1-2025: Report
New Delhi: US tariff uncertainties are likely to push gold prices to Rs 87,000- Rs 90,000 in the first half of the calendar year 2025 (January- June), according to a report by ICICI Bank Global Markets. Currently, the gold prices are at around Rs 83,410 per 10 grams for 22-carat and Rs 90,990 per 10 grams for 24-carat, publicly available data showed. The report added that the uncertainties arising due to the tariffs will ensure the investment-related demand for gold is in place. Beginning on April 2, the Trump administration intends to implement reciprocal tariffs on trading partners as part of the "Fair and Reciprocal Plan". In India, the local gold prices rose by 4 per cent in the past month, reflecting the global market trend and an appreciation of 2 per cent in rupee terms against the US dollar. "Going forward, local gold prices are expected to trade with an upside bias in the INR 87,000 per ten grams to Rs 90,000 per ten grams range in 1H2025 and moving to the Rs 94,000 per ten grams to the Rs 96,000 per ten grams range in 2H2025," the report added. The report anticipated that the gold prices in the global markets will be in the range of USD 3200 per ounce to USD 3400 per ounce level by December 2025. Additionally, the US Federal Reserve's potential decision to lower interest rates in 2025 and 2026 could make gold more attractive, as lower US yields may support gold demand, the report added. Central banks may also continue to diversify their reserves by holding more gold, which could keep prices steady for the long term, as per the report. "Elevated levels of gold prices appear to be weighing on jewellery demand, which worked to pull gold imports to their lowest level in the past 11 months, at USD 2.3bn, reflecting a 14 per cent MoM decline and a 63 per cent YoY decline. Demand should pick up, responding to the festive related seasonal demand that tends to take place," the report added. However, gold fund flows into local ETFs still remain fairly robust, as the World Gold Council (WGC) has reported. Gold ETFs recorded inflows to the tune of Rs 19.8bn in February 2025 that were above the average net inflow of Rs 14.8bn recorded in the preceding nine months.
