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Showing posts from May, 2025

No Cuts Expected in Capex or Social Sector Spending for FY26, Say Economists; India Has Strong Fiscal Buffers

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 India is unlikely to scale back its capital expenditure or social sector allocations in the financial year 2025–26, even if geopolitical tensions escalate, according to leading economists. They emphasize that the government has ample fiscal buffers — including contingency funds and emergency reserves — to cover any unexpected defence-related costs without disrupting existing budget plans. In an interview with Moneycontrol , Sri Hari Nayudu, economist at the National Institute of Public Finance and Policy (NIPFP), noted, “The immediate impact would be minimal. If necessary, RBI reserves can be tapped, and emergency or contingency funds are available. There’s no need to divert money from the social sector or other areas to cover war-related expenses.” Nayudu pointed out that the government has several mechanisms at its disposal to meet potential defence needs. “Beyond the budget allocation for defence, we can access the contingency fund. Other financing options are also available....

Jerome Powell Fires Back: 10 Sharp Warnings About Trump’s Tariff Strategy

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 U.S. Federal Reserve Chair Jerome Powell didn’t mince words during his latest press conference, issuing a string of strong cautions about the dangers of President Donald Trump’s tariff policies. While Powell maintained that the U.S. economy remains fundamentally sound, he warned of growing vulnerabilities—largely fueled by trade uncertainty and unpredictable policy decisions. The Fed opted to keep interest rates unchanged for the fourth straight meeting, but the tone of Powell’s remarks and the updated policy statement revealed a shift toward concern. With indicators of weakening business confidence and the specter of stagflation on the horizon, Powell made it clear that escalating tariffs could threaten the Fed’s core goals: stable prices and full employment. Here’s a breakdown of the 10 most striking warnings Powell delivered in response to Trump’s trade war: 1. Fed Independence Is Non-Negotiable Powell pushed back hard against Trump’s persistent demands for rate cuts, stati...

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