On the back of falling international oil rates and appreciating rupee, petrol prices may be cut by Rs 1-1.50 per litre next week. However, a one-time hike in diesel and possibly LPG rates is still on the cards.
Accoding to sources in the finance ministry, there is enough leeway in the Budget to manage the Rs 40,000-50,000 crore fiscal deficit stress. The government may fetch Rs 25,000 crore from Hindustan Zinc, Bharat Aluminium Company (BALCO) stake sale instead of Rs 14,000 crore.
The average US price of a gallon of gasoline has jumped 11 cents over the past two weeks.
Himanshu, professor of economics, JNU and Siddhartha Sanyal of Barclays Capital agree that the government must release grain to loewr prices and the bridge fiscal deficit on growth not hikes in diesel prices.
Car sales in India may be on a downslide at present but global marketing information services company JD Power believes that the total automobile market size will triple to 9.3 million units by 2020
JP Morgan Securities lowers its rating on Bajaj Auto Ltd to "underweight" from "neutral" and cut its target price to 1,800 rupees from 2,060.
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UR Bhat, MD, Dalton Capital Advisors, in an analysis on CNBC-TV18, explains that the hike in diesel rates has been priced-in and that the Nifty will find support at 5,600
India's headline inflation rate is expected to have accelerated in September to its highest this year after the government raised subsidised fuel prices, but the Reserve Bank of India bank will remain under pressure to cut rates at a policy meeting this month.
Petrol price may be cut by about Rs 1.60 per litre later this month as appreciation of rupee against the US dollar has helped state firms make profit on the fuel.
Raj Majumder of Auroch Investment Managers explains to CNBC-TV18 that the market is on the defensive, the government has to hike fuel prices immediately and the de-allocation process will not be as easy as imagined as most defaulting companies may have legally sound reasons and could initiate legal action.
The rupee strengthened on Tuesday on hopes the government would kick-start long-awaited fiscal reforms by hiking fuel prices, but further gains were prevented by dollar demand from oil firms and a week full of key events.
As the industry fights a prolonged lull in the automobile market, component makers and OEMs came under one roof today at the ACMA Annual Conference in an effort to forge a close partnership to tide over the storm.
The rupee fell for a fourth successive session on Wednesday on growing worries of a government dithering despite mounting fiscal and economic challenges, although a late recovery in the euro helped offset most losses.
India's industrial production grew at a higher-than-expected pace of 2.4% in May driven by manufacturing output, government data showed on Thursday.
India's wholesale price inflation accelerated to 7.55% in May from a year earlier, driven by double-digit rises in food and fuel prices, government data showed on Thursday.
The government has not yet fixed a date for ministers to review diesel pricing, Oil Minister S. Jaipal Reddy said on Friday, suggesting no immediate increase is on the cards.
India's top car makers posted lacklustre sales in May as an excise tax hike and rising fuel prices hit demand, casting more gloom over the country's economic outlook.
Analysts at Goldman Sachs and Bank of America-Merrill Lynch cut their growth forecasts for India, following up on a Morgan Stanley downgrade earlier this week that had sparked much concern in domestic markets.
A partial rollback in the petrol price hike is on the cards with the Central Government realising that the steep increase of over Rs 7.50 per litre could have a very heavy political cost.
Under pressure from its allies, the Opposition and the public over the steep hike in petrol price, the Congress has asked all its state governments to cut taxes on fuel prices.
The auto index falls 1.1% on speculation the government could raise fuel prices, adding to worries about a sector facing uncertainty about future sales and rising raw material costs because of the falling rupee.
Sanjay Mathur of RBS expects a total of 50 basis points cut in interest rates for the rest of FY13, but not before September.
Speaking to CNBC-TV18, Economic Affairs Secretary R Gopalan said the government was working on an easy, transparent mechanism to implement GAAR.
For India to reach its target for cutting the budget deficit, Prime Minister Manmoham Singh would almost certainly have to raise prices for subsidised fuel products.