Latest news with #R.Madhusoodanan
Times of Oman
08-04-2025
- Business
- Times of Oman
Stock markets end with gains
Muscat: Stock markets in the Gulf region, including Oman, India and Asia closed higher on Tuesday, recovering from global selling on hopes that the United States is willing to negotiate some significant import tariffs. However, on Monday, major stock indices had plunged mainly due to the impact of reciprocal tariffs imposed by China. Speaking to Times of Oman, R. Madhusoodanan, a former SBI official and financial expert said, the reasons attributed to the steep fall are both global and domestic. The global markets have taken cues from the fall of stocks in Wall Street, he said. The Trump administration's announcement of higher tariffs has not been taken positively by the investors across the globe including that of the US, he added. All the economies of the world including emerging markets (EM) are very much concerned about the outcome, he said. This has created a panic and uncertainty in the global trade. The global investing community is more worried about the unpredictable announcements of the US administration, he said. Federal Reserve Chair Jerome Powell has remarked that the proposed tariffs are 'larger than expected'. The experts predict a global recession. This Fear of a looming recession coupled with high inflation and interest rates in the US can adversely affect the economic growth of the US in the short term to medium term horizon. This was one of the reasons for tumbling of the US stocks. The US Dollar Index (DXY) , which is a measure of the strength of the US dollar against a basket of major currencies, is also down at 102.88 levels. The retaliatory tariffs imposed against the US products by countries like China, Mexico and Canada is another reason. The industries in the US too are affected in the tariff war. The US dairy product export is over $8 billion annually. China and Mexico have already hiked the tariffs on dairy products of the US, which made the industry in uncertainty Madhusoodanan added.
Times of Oman
02-04-2025
- Business
- Times of Oman
Trump's upcoming tariff – emerging market economies grow wary
Muscat: US President Trump is expected to announce announce sweeping global tariffs soon. His stance is that if they charge us, we charge them. Speaking to the Times of Oman, R. Madhusoodanan, a financial expert, said the American President believes that the US is being treated unfairly in global trade, creating an imbalance in tariffs. Emerging Market (EM) economies like India, Brazil, South Africa, Turkey, Indonesia, Thailand, Vietnam, etc, impose higher tariffs on exports from the US than the US levies on imports from these countries. The potential move applicable to most of the goods imported to the US will adversely impact all emerging market economies like India in the short term. Sectors like Automobiles, IT, Pharma, Electronics, Textiles, Gems and Jewellery, key manufacturing industries, agritech will be the worst affected, he said. Indian exports to US for the FY 2024-2025 may cross USD 80 billion, and India has always had a comfortable trade surplus with the US. Hence, the relationship with the US is crucial for India. India currently levies a weighted average rate of close to 10% on US exports, while the US levies an average of 3% on Indian goods. The bilateral discussions are reportedly positive. The US acknowledged India's move to reduce tariffs on cars, motorcycles in the Union Budget, and also the removal of 6% equalisation levy, or the so called Google tax. In view of the developments, the US may also consider a pause on reciprocal tariffs for a few months. No doubt, if not deferred, the new rule may disrupt trade flows, particularly the sectors mentioned above. The US is also not spared. For example, their export of dairy products worth more than $8 billion is facing problems as China and Mexico have already imposed retaliatory tariffs on US dairy products. In short, the Emerging markets (EM) may see this as an opportunity to diversify their trade avenues, reducing tariffs on products and services, and also strengthening domestic manufacturing and services to minimize the impact of reciprocal tariffs, a long-term solution, R. Madhusoodanan said.
Times of Oman
08-02-2025
- Business
- Times of Oman
Rupee likely to be volatile after rate cut by Indian central bank
Muscat: The Indian central bank, Reserve Bank of India, has cut the Repo rates by 25 bps, a cut in nearly five years in line with the market expectations. The repo rate is the rate at which the central bank lends money to commercial banks. Speaking to Times of Oman, R. Madhusoodanan, Executive Advisor to the Board, Global Money Exchange said, this decision may give some respite to the falling rupee against OMR. in the short run. The INR has depreciated heavily in the past few days and the exchange houses in Oman offered close to 227 against one OMR. Indian forex market witnessed heavy volatility and INR was under pressure on account of domestic and global factors. The uncertainty triggered due to US President Donald Trump's fresh tariff war, continued foreign market outflows etc contributed to the INR fall. The rate cut may provide ample domestic liquidity in the system, he said. Going forward, the RBI is expected to go for a market driven pricing for the INR, a strategy that seems appropriate for the current economic landscape, which may likely to benefit the NRIs and Indian Exporters, he added. This was the first policy meeting of the present RBI Governor, Sanjay Malhotra, since his taking over. The RBI Governor said the real GDP growth for the financial year ending this March has been estimated to be 6.4%. It can be seen that the RBI is complementing the budget reforms and it has prioritised growth over inflation, R. Madhusoodanan said. While the rate cut results in cheaper credit and enhance credit flow across sectors, helping revive the sluggish GDP growth, investment and employment generation, it may adversely impact the middle class and retirees as the banks may reduce the rate on deposits as well, he said. Undoubtedly, the unanimous decision of the MPC has generated a positive sentiment across various sectors and is expected to support Indian economic growth, Madhusoodanan added.
