Latest monsoon projection may take the wind out of India's markets
- The latest forecast from
Skymetis expected to take a toll on marketstoday and cause some volatility in the trading of agro-commodities.
- The weather forecasting organisation has predicted that India’s
monsoonwinds will arrive in Southern India later than expected, by the first week of June, and provide lesser-than-expected rainfallthis year.
- A strong monsoon always provides a filip to India’s economy. Not only does it increase farm production, prevent food inflation and raise rural demand, but it also stimulates business and consumer confidence.
In a rainfall deficient period, it’s harder for a bull run to take place in financial markets as investors get jittery. If harvests are low, this also increases the pressure on the government to give sops to
This is why the latest forecast from Skymet is expected to take a toll on markets today and cause some volatility in the trading of agro-commodities.
The weather forecasting organisation has predicted that India’s monsoon winds will arrive in Southern India later than expected, by the first week of June, and provide lesser-than-expected rainfall this year.
The monsoon period is expected to end by September, when the last of the winds leaves the western state of Rajasthan. Jatin Singh, managing director of Skymet, told Reuters that India would receive, “93% rainfall of the long period average in 2019.”
Singh added that central India would get 91% of the average rainfall while eastern India would get 92%. South India, meanwhile, should get 95% of the average.
Skymet’s prediction clashes with forecasts from the government-run India Meteorological Department (IMD), which said last month that there would be average rainfall this season - which provided a strong boost to stock markets the day it was announced.
The monsoon reportedly accounts for 70-80% of India’s water requirement for agriculture which is why people will keep a close eye on forecasts in the immediate future.
The mystery of India’s erratic monsoon can be found in the Indian ocean