NEER, REER appreciate in December 2016

36-currency export based indices rise by 0.6%

by Natasha Nadkar

The Nominal Effective Exchange Rate (NEER) of India appreciated in December 2016 as compared to the previous month. On a m-o-m basis, the 36-currency export based NEER and trade based NEER rose by 0.6 per cent and 0.7 per cent, respectively. In addition to this, the six-currency trade based NEER increased by 1.1 per cent.

On a y-o-y basis, the 36 currency export-based NEER increased by 1.5 per cent while the trade-based NEER rose by 1.4 per cent.

On a m-o-m basis, Real Effective Exchange Rate (REER) of India appreciated in December 2016. The 36-currency export based REER and trade-based REER rose by 0.6 per cent and 0.7 per cent, respectively. Further, the six-currency trade based REER rose by 1.1 per cent.

On a y-o-y basis, 36 currency export-based and trade-based REER rose by 2.9 per cent and 3.2 per cent, respectively.

The indices of NEER and REER are used as indicators of external competitiveness. NEER is the weighted average of bilateral nominal exchange rates of the home currency in terms of foreign currencies. Conceptually, the REER, defined as a weighted average of nominal exchange rates adjusted for relative price differential between the domestic and foreign countries, relates to the purchasing power parity (PPP) hypothesis. Increase in indices indicates appreciation of rupee and vice-versa.

References
1. https://rbidocs.rbi.org.in/rdocs/Bulletin/PDFs/36T310290B87A9242DDB044DE1EE0A0196A.PDF
CMIE STATISTICS
Unemployment Rate
Per cent
5.5 -0.0
Consumer Sentiments Index
Base September-December 2015
94.7 0.0
Consumer Expectations Index
Base September-December 2015
96.5 0.0
Current Economic Conditions Index
Base September-December 2015
91.9 0.0
Quarterly CapeEx Aggregates
(Rs.trillion) Mar 16 Jun 16 Sep 16 Dec 16
New projects 3.31 1.54 2.34 1.42
Completed projects 2.26 0.90 2.15 0.76
Stalled projects 1.04 1.32 0.35 0.44
Revived projects 0.63 0.42 0.51 0.17
Implementation stalled projects 0.92 0.50 0.57 0.79
Updated on: 23 Feb 2017 9:20AM
Quarterly Financials of Listed Companies
(% change) Mar 16 Jun 16 Sep 16 Dec 16
All listed Companies
 Income -0.2 -0.9 2.1 6.4
 Expenses 0.9 -0.4 1.8 6.7
 Net profit -29.1 -3.5 15.3 36.9
 PAT margin (%) 4.9 6.9 7.0 6.0
 Count of Cos. 4,395 4,353 4,313 4,204
Non-financial Companies
 Income -2.1 -2.5 0.6 6.1
 Expenses -3.9 -2.9 -0.2 7.7
 Net profit 4.8 10.3 27.5 21.0
 PAT margin (%) 6.2 7.4 7.0 6.1
 Net fixed assets 3.8 -9.2
 Current assets 3.1 8.1
 Current liabilities 10.6 11.5
 Borrowings 6.7 3.1
 Reserves & surplus 7.9 8.6
 Count of Cos. 3,455 3,426 3,393 3,316
Numbers are net of P&E
Updated on: 23 Feb 2017 9:28AM
Annual Financials of All Companies
(% change) FY13 FY14 FY15 FY16
All Companies
 Income 11.9 9.3 4.3 0.2
 Expenses 12.1 9.2 4.3 0.3
 Net profit 1.0 -4.2 2.7 -12.1
 PAT margin (%) 3.6 3.2 3.3 3.4
 Assets 14.1 12.2 8.9 7.7
 Net worth 9.5 9.4 8.2 6.2
 RONW (%) 6.8 6.0 6.1 5.7
 Count of Cos. 23,087 20,259 18,916 14,317
Non-financial Companies
 Income 11.1 8.9 3.3 -1.1
 Expenses 11.4 8.6 3.4 -1.9
 Net profit -8.9 -5.6 -3.6 14.1
 PAT margin (%) 2.4 2.1 2.2 3.1
 Net fixed assets 12.9 11.3 12.3 10.8
 Net worth 7.7 8.3 6.6 5.0
 RONW (%) 5.4 4.8 4.8 6.1
 Debt / Equity (times) 1.1 1.1 1.1 1.0
 Interest cover (times) 2.0 1.9 1.9 2.1
 Net working capital cycle (days) 71 69 68 68
 Count of Cos. 17,721 15,860 14,813 11,415
Numbers are net of P&E
Updated on: 21 Feb 2017 3:48PM

Low government spending and low consumer expectations to keep growth subdued

Modest increase in capital expenditure; no incentive to private players

Rs.5.34 trillion or 3.2% of GDP