Major Economic Indicators for India

India
IndicatorRelease dates
Balance of Tradeat the beginning of each month
Gross Domestic Product (GDP)quarterly
Industrial Production Indexat the beginning of each month
Current Accountquarterly
Wholesale Price Indexin the middle of each month
Consumer Price Indexaround the 20th of each month
RBI Monetary Policybimonthly
Unemployment Ratethe first Friday of each month
Name of Indicator
RBI Monetary Policy
Release Date
bimonthly
Characteristics of Indicators

RBI monetary policy is released by the Reserve Bank of India (RBI) which sets policy interest rates. Policy interest rate is the rate at which banks borrow and lend funds from the central bank. When the inflation rate is high, the Reserve Bank of India raises policy interest rate. On the other hand, the policy interest rate is lowered by the central bank when inflation rate drops. Thus, this indicator is very sensitive to inflation.

It is necessary to keep in mind that, when the policy interest rate is raised, the Indian rupee will go up, and when the interest rate is lowered due to low inflation rate, the Indian rupee will fall.

In the RBI monetary policy, the interest rate is set according to the economic performance and prices of commodities. When the interest rate is set in opposition to the estimates, it is likely that volatility in exchange rate will occur. Thus, it is very important to pay attention to this economic indicator.

Name of Indicator
Gross Domestic Product (GDP)
Release Date
quarterly
Characteristics of Indicators

Gross domestic product (GDP) is the sum of the gross value added of domestic production of goods and services within a specific period of time. It is considered as an important indicator of economic growth and production activity in long-term trends. The advanced GDP estimates, as well as the preliminary and final GDP estimates, are released at the end of the month after each quarter ends. It draws the attention of investors as it is the broadest indicator of economic activities and it measures the overall economic performance of the country.

Compared with the previous data, we examine whether there is an increase or decrease in the GDP growth rate to evaluate the economic performance of the country. Investors are more focused on advanced estimates and they examine the personal consumption expenditures, residential investment, fixed investment, inventory investment, and government consumption expenditures and gross investment. As it is a comprehensive indication of the overall growth rate of a country, it is very important for investors to pay attention to this economic indicator.

There are two measures of GDP: nominal gross domestic product (nominal GDP) and real gross domestic product (real GDP). The real GDP is different from the nominal GDP as it accounts for price changes due to inflation.

Name of Indicator
Consumer Price Index
Release Date
around the 20th of each month
Characteristics of Indicators

Consumer price index is an economic indicator that measures the changes in the retail prices of consumer goods and services actually purchased by consumers. Since it is an important indicator that is closed correlated with the inflation rate, many countries, such as the United States, EU, Japan, China, Australia and emerging countries, pay special attention to this index in the market.

To put it simply, consumer price index indicates price inflation and deflation. If the consumer price index increased dramatically, it is most likely that interest rates will be raised in order to keep the rate of inflation low. As this economic indicator is closely related to the exchange rate volatility, it is necessary to look at the consumer price index while trading.

Name of Indicator
Unemployment Rate
Release Date
the first Friday of each month
Characteristics of Indicators

Unemployment rate is an indicator that shows the percentage of unemployed people in the labor force. The definition of “unemployed people” varies from one country to another. By looking at unemployment rate, one can keep track of the employment situation of the country. It is thus the most important economic indicator that draws the attention of investors. To rank the developed countries in the order of unemployment rate, it is as follows: EU, United States and Japan. Similar to inflation rates, unemployment rate is closely correlated with people’s daily life. It is thus sometimes used for political purposes.

While examining the unemployment rate, there are three statistics that an investor needs to pay attention to: the statistics of the previous month, market forecast prior to the release of unemployment rate, and officially released unemployment rate. Especially, one should look at the market forecast and officially released unemployment rate. If there is a big difference between the released unemployment rate and the market forecast, it is very likely that large movements in the market will occur.

This data is also an important indicator of the performance of a company and sometimes it can influence the monetary policy. In particular, during economic downturns, monetary easing is likely to be carried out immediately after the release of unemployment rate.

Name of Indicator
Balance of Trade
Release Date
at the beginning of each month
Characteristics of Indicators

Balance of trade offers the statistics about India’s imports and exports and it is released by the Ministry of Commerce and Industry, Government of India, on a monthly basis. A positive number indicates a trade surplus and a negative number indicates a trade deficit. If a positive balance is reported, it denotes good economic condition. On the other hand, if a negative balance is observed, it indicates unfavorable balance of trade.

Name of Indicator
Industrial Production Index
Release Date
at the beginning of each month
Characteristics of Indicators

Industrial production index, released by Central Statistics Office of the Ministry of Statistics and Programme Implementation, is an economic indicator that measures the production activities in the mining and manufacturing industries. Because the industrial sector generally makes up a large portion of GDP and has an impact on the economy on the whole, it is considered as one of the most important indicators to evaluate the economic performance. In addition, investors tend to keep track of the industrial production index as it is released in advance of GDP and signals the economic performance of the country.

Name of Indicator
Current Account
Release Date
quarterly
Characteristics of Indicators

Current account is one of the components of balance of payments and it comprises the balance of trade, the balance on services, the balance on investment income and the balance on current transfers. The balance of trade calculates a difference between imports and exports. The balance on services refers to service transactions. The balance on investment income is the profit received from foreign direct investment and portfolio investment. The balance on current transfers refers to provision of assistance with goods, such as, the official development assistance to medicine.

Name of Indicator
Wholesale Price Index
Release Date
in the middle of each month
Characteristics of Indicators

Wholesale price index is an economic indicator that measures the price changes in the intermediate goods and raw materials which are traded between corporations. The index is released monthly by items, industries and manufacturing stages. The base sales price is set to the level of 100. Compared with the base price, the index measures and shows the changes in values.

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