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Amid Fears Of Global Inflation, Indian Investors Are A Worried Lot

by GoNews Desk 1 month ago Views 1205
Amid Fears Of Global Inflation, Indian Investors A
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Inflation has also started to rise across the world due to sluggish economic activities amid the Coronavirus period.

After the arrival of inflation figures in the US, there are signs that there is an increase in inflation at the global level.

Also Read: 'Offering An Insincere Apology Would Be Contempt Of My Conscience': Prashant Bhushan

If this happens then it could have a bad effect on emerging economies like India, Mexico and Russia. This claim has been made by the US media company Bloomberg after studying 10 emerging markets. The report says that the stock markets of India and Mexico are the most vulnerable to any surge in consumer prices.

If you adjust the return on investment in these stock markets with the coming inflation, then it seems that the investors are not going to benefit much.

In contrast, the bonds in South Africa and Indonesia appear best positioned to weather any upsurge in inflation owing to central bank stimulus to counter the Coronavirus outbreak in the two countries.

The quickening of inflation can be particularly disastrous for emerging markets like India as it reduces the real yield premium which compensates investors for holding riskier bonds and shares. Rising price pressures also hinder the ability of central banks to cuts interest rates, which can further complicate the process of recovery from the COVID-19 pandemic.

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