Treasuries began the second half of the year on the front foot Friday as concerns continued to mount that Federal Reserve rate hikes will lead to a recession.Benchmark 10-year yields fell 6 bps to 2.95% in a fourth day of declines and looked set for their biggest weekly drop in 7 weeks.The prospects for a recession were enhanced overnight after data showed personal spending for May rose 0.2%, half the expected increase.The price index for purchases rose 0.6% versus an expected 0.7%
The government on Friday slapped a Rs 6 per litre tax on exports of petrol and ATF and Rs 13 per litre on exports of diesel.The government also slapped a Rs 23,230 per tonne additional tax on domestically produced crude oil to take away windfall gains accruing to producers from high international oil prices, a separate government notification showed.The tax on exports follows oil refiners, particularly the private sector, reaping huge gains from exporting fuel to markets such as Europe and US.
The RBI on Thursday said the Indian economy is well on the path of recovery even though inflationary pressures and geopolitical risks warrant careful handling and close monitoring of the situation. The RBI's 25th Financial Stability Report also said banks as well as non-banking financial institutions have sufficient capital buffers to withstand shocks. Notwithstanding the challenges from global spillovers, the Indian economy remains on the path of recovery.
U.S. consumer spending rose less than expected in May as motor vehicles remained scarce while higher prices forced cutbacks on purchases of other goods, another sign that the rebound in economic growth early in the second quarter was losing steam.Though the report from the Commerce Department on Thursday suggested inflation had probably peaked, price pressures remained strong enough to keep the Federal Reserve on its aggressive monetary policy tightening path.