President Trump’s America First policies are being noticed in India. The first, most obvious, was the H1B related restrictions and consequent impact on export of high skilled services from India. Now the potential impact of Iran sanctions (full force targeted for November 6th 2018) is looming on the horizon.
The metric most accessible to notice how India is responding to these changes, in the rule of global economic game, is the USD to INR foreign exchange rate. From a low of 63.3 in January 2017 it went up to 68.9 in July 2018. RBI then intervened with an increase in repo rate and the FOREX rate appears to have stabilized at around 68.5.
The need to manage the forex rate arises from India’s dependency on oil imports (both for fuel as well as fertilizer). The downward pressure on export of skilled services adds to the anxiety of FOREX required to manage rise in oil prices, as dollar repatriation decrease (a fall out from a combination of America First policy shift as well as the shifts towards cloud, big data, AI/ML based systems and the rise of the gig economy which has made skilled services available at lower costs without IT Cos as intermediaries). Slowdown in Middle Eastern countries has also contributed to lower levels of skill based dollar repatriation that helped India’s balance of payments.
India also appears to be attempting to conserve FOREX by imposing import tariffs on a series of imports, which are likely to impact trade with China (and that is additionally rationalized under the Make in India / create local employment rubric – which falls in line with the America First doctrine as well).
Increased interest rates and import tariffs may likely help in stabilizing the FOREX reserves situation as oil prices rise. Whether such a strategy will be enough, especially if there is an economic shock of a US recession, remains to be seen. After all it’s been 10 years of slow but steady (and now a sharp spurt in 2017-2018) economic growth in the US that has powered most of the global growth.
So what does it mean for the India Investor in the next 18 months?
To answer that lets us turn to the subtle moves in the graha energies in the India Independence birth chart, which we may be able to use to assess, at a high level, what to expect in the next 18 months (from August 2018) in this context.
The India chart is currently showing Moon dasha and Rahu bhukti (which ends on August 15th 2018). The 13 months of Rahu bhukti (since July 2017) may have given confusing and deceiving signals about the underlying well-being of the Indian economy. As Jupiter bhukti begins after August 15th 2018, we may begin to see a different contour. And the resulting reality check may intensify when transit Jupiter moves from Libra into Scorpio in mid-October and is immediately afflicted by the 5th aspect of transit Rahu. The weeks between mid-October to mid-November 2018 may see some sharp changes in investor sentiment in India.
So to the question to pose may be as follows: when should India investors move more towards cash and cash like investments? Astro analysis indications are to do so between now and mid-October 2018.
Next questions: How much of your portfolio should you move towards cash? How long to hold in cash? And what to disinvest in, and what to remain invested in, are questions I may broadly cover in multiple future posts, as time permits.
Usual Caveats apply: All of the above is at a general level – very broad 100,000 ft indications. Action and experience takes place at the individual level, where things get much more complex. There can really be no cookie cutter problem identification or solutions.
I use Systems Approach to Vedic Astrology as propounded by Professor V.K. Chaudhary in developing my Astro Analysis posts.
© Jayant Kalawar and 21BanyanTree.com