Dollars and oil.

Despite the global kerfuffle due to fireworks in Ukraine, "We have raised our 2022 calendar year (CY22) growth forecasts for India to 9.5% from 7%, and maintained our forecast for 5.5% growth in 2023 (CY23). This translates into 8.4% and 6.5% in fiscal years 2022-23 and 2023-2024, respectively," Moody's said in its latest Global Macro Outlook, BS. "Fitch Ratings, on the other hand, maintained its earlier projection of 10.3 percent growth in FY23 compared to 8.4 percent estimated for  FY22." Spiffing. "India's exports in January rose 25.28% to USD34.50 billion," "even as trade deficit widened to 17.43 billion, according to data released by the commerce ministry," as "Imports grew by 23.54 percent to USD51.93 billion," ET. Exports increased by 46.73% to $335.88 billion from April 2021-January 2022, while imports increased by 62.65% to $495.75 billion giving a deficit of $159.87 billion. Crude oil imports rose 26.9% to $11.96 billion in January. India's demand for petroleum fuels is projected to rise to a record 214.5 million tons in the year starting on 1 April even as the price of crude oil has closed in on $100 per barrel. India imports 85% of its oil requirements. Global benchmark Brent crude jumped to $105.79 per barrel following Russia's entry into Ukraine, before settling at $99.08 a barrel, Reuters. "The surge in oil prices is likely to have an impact on inflation in domestic markets," TOI. Domestic fuel prices have been frozen for 110 days in a row because of elections in 5 states, NDTV. "Industry officials said that retail pump prices are aligned to a price of $82-83 per barrel, and they would certainly go up once elections end next month." Although oil is bought in dollars it is sold to us in rupees, so if the rupee becomes weaker against the dollar, retail prices of petrol and diesel will rise even more. The rupee is trading at 75.31 to the dollar this morning, xe. The strength of the rupee is not wholly in our hands because the strength of the dollar depends on economic data out of the US and the response of the US Federal Reserve. Consumer prices surged by 7.5% compared to a year ago in January, the US Labor Department reported, CNBC, while the producer price index, which reflects wholesale inflation, jumped by 9.7% from a year ago, ET. "Rents have exploded across the country, causing many to dig deep into their savings, downsize to subpar units or fall behind on payments and risk eviction now that a federal moratorium has ended," AP. "In the 50 largest metro areas, median rent rose an astounding 19.3% from December 2020 to December 2021, according to a Realtor.com analysis of properties with two or fewer bedrooms." Hitting the poorer segments of society. At the moment Fed officials are ruling out "jamming brakes" through larger rate hikes, BT, but their hands maybe forced by events in Ukraine and sanctions on Russia. Our Reserve Bank (RBI) is basing its calculations on an average oil price of $70-75 per barrel in the next financial year and sees no problem with inflation. But, crude oil futures predict a gradual settling of the price from $95 per barrel in April 2022 to around $79 in June 2023, CME. What if the Fed goes for a 50 basis points hike in its Funds Rate? Double spiffing.