WHY ECONOMIC PROBLEMS ARE YOUR MONEY PROBLEMS

HERE is an ongoing conflict in West Asia that is likely to hurt economies even after it ends.

- RAJAS KELKAR

India will not be an exception.Let that sink in. The world’s fastest-growing large economy could still do better than many others. However, your money is at odds with any semblance of stability. The purchasing managers’ index (PMI) data shows that India has experienced expansionary activity every month. Yet the labour market in India has softened, with unemployment rising, according to the Reserve Bank of India’s latest monetary policy report. That is likely to hurt the income side of your household balance sheet if you are the one looking for a new job or expanding your work profile to boost your income.

On the other side, inflation is likely to rise. “Energy price spikes driven by the war in West Asia pose risks to the domestic inflation outlook, going forward,” said the latest RBI monetary policy committee report. That means while income uncertainty rises, your consumption is likely to become more expensive.