Macquarie Sec warns inflation risky for India, bets on IT

Economists and experts are worried even as policymakers are trying to combat rising prices with higher interest rates and to keep local currencies from appreciating too sharply. Richard Gibbs, Macquarie Securities feels that inflation will remain key risk for domestic markets.

January 24, 2011 / 12:31 IST

Economists and experts are worried even as policymakers are trying to combat rising prices with higher interest rates and to keep local currencies from appreciating too sharply in Asia. Richard Gibbs, Macquarie Securities feels that inflation will remain key risk for domestic markets.

In an interview to CNBC-TV18, Gibbs said that the Reserve Bank of India will have to respond to high inflation so further tightening in liquidity can be expected.

Though most experts have given thumbs down to Indian markets, Gibbs holds a different opinion. According to him, Indian markets are likely to see limited correction. He is optimistic that specific sectors in India may outperform overall markets.

However, companies with high PE valuations may not be sustainable, he warned.

first published: Jan 24, 2011 11:15 am

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