Indian economy will do a “soft landing” in 2024, know why

There is no doubt that the world economy is facing many risks, aggressive rate hikes and geo-political tensions are primary triggers for increase in growth concerns. This is because of many concomitant growth concerns that along with Fed, institutions like IMF, World Bank have also lowered growth forecast for next year. But Indian brokerage, Motilal Oswal believes that Fed officials and US GDP data till now are building optimism for a softer landing.

“There has been a lot of debate regarding soft and hard landing post the rate hikes, however, Fed officials and US GDP data till now are building optimism for a softer landing,” Motilal Oswal said in their note on Friday. According to the brokerage, there are many factors to look at when we talk about the next year.  “Monetary policy changes, fluctuations in the Dollar Index and economic data points could provide triggers in the market. Even after such aggressive rate hikes, market participants will keep an eye on inflationary concerns and Fed’s move accordingly,” the note stated today. 

The brokerage added further that the risk premium on the back of geo-political tensions, lower Dollar Index, higher rate cut expectations, slower growth fears, inflows in ETF, central bank gold bank spree, development in China and green technology and possible rupee depreciation could keep the floor strong.