Budget expectation: Address current economic slowdown

By Rahul Jain

We hope that the budget will address the current slowdown in the economy, at the same time care should be taken to ensure the fiscal deficit does not exceed 3.5 percent of GDP in 2018 19.

While we have witnessed some economic slowdown in FY19, we can expect FY20 to certainly see a turnaround in economic growth rates, especially in the second half. A slippage in fiscal targets will cause hardening of bond yields, in the short term, however, they are likely to stabilise as inflation is manageable.

It is our view that the double dose of liquidity and fiscal nudge could act as a much-needed shot in the arm for the economy and the possible exemption of LTCG could act as a pleasant surprise for the capital markets.

Rahul Jain is Head of Private Wealth Advisory, Edelweiss