As traders wait on the Fed to add more stimulus to the U.S. economy it is important to see how the rest of the world is performing. From recent data on manufacturing it is obvious that growth has been slowing down worldwide. Despite the rally we have seen the last few days on the hope of stimulus the fact of the matter is the world is hurting, global risk has reached Asia with lower orders from the rest of the world. In 2010 India recovered from the global recession due to their growth exceeding 8% year after year. Since 1997 India has been growing above 7% according to the World Factbook. According to a report by the World Bank India's GDP was worth 1729.01 billion dollars in 2010 or 2.79% of the world economy.
In 2011 India's economic growth started to slow the rupee has depreciated close to 25% over the past year currently trading at 54.53 USD/INR. Despite the crisis in the euro zone the rupee has also slipped against the euro about 10% in the past year currently trading at 68.32 EUR/INR. In the first quarter of 2012 India's GDP growth rate expanded 5.3%. Let us not forget the high inflation rate in the country inching its way up to 7.55% in May and interest rates hovering at 8% make for a troubling economy. India still faces widespread poverty and inadequate access to higher education although they do have a large English speaking population who are major exporters of information technology services. Non agricultural jobs are still a concern in the Asian country their unemployment rate stands at 9.40%.
The SENSEX 30 a major stock market index in India closed at 17,462.81 it has rallied 1461 points in the last month. One of the top performers for the day was Sterlite Industries India Ltd which manufactures electrical wires as well as zinc and lead products. You can find Mukesh Ambani as one of the 38 Indian billionaires on Forbes he makes the list at number 19 compared to other world billionaires, he is the richest man in India.
It seems the Indian boom that lasted for more than a decade is coming to a halt and some worry about a lost decade. Morgan Stanley has lowered its forecast for India's economic growth for 2012 and 2013.