Employment creation needed to sustain consumption growth, says UBS
India witnessed a resilient consumption growth over the last few years even as macros were muted and in order to […]
Sarabjit Kaur December 20, 2017
MORE IN News
India likely to be Apple’s 3rd largest market in next 2 to 3 years: Experts
RBI tweaks rules to cut risk banks face in exposure to capital markets
Tech layoffs: Over 80,000 tech employees lost jobs globally in first four months this year
Apple logs strong double-digit growth in India, to produce more in country: Tim Cook
Decline in battery costs boosting green energy projects: ICRA
India witnessed a resilient consumption growth over the last few years even as macros were muted and in order to sustain this momentum a pickup in employment is needed, says a report by UBS.
According to the global financial services major, consumption growth in India over the past three to four years has been perceived by investors as resilient, despite a muted macro environment and weaker household disposable income trends.
“Our discussions with macro experts and government officials indicated that job creation remains a key focus area, especially going into the 2019 general elections,” UBS said in a research note.
It further noted that muted household disposable income trends reflect possibly weaker employment trends in India, though there is no recent credible data on job creation.
“A material expansionary policy [fiscal/monetary], like the one seen early this decade, or strong global growth seen last decade is absent and unlikely anytime soon,” UBS said adding that a pickup in employment is thus needed to sustain/accelerate consumption growth.
The global brokerage further said, “the Indian market is trading near historical highs, at 17 times 12-month forward PE, off consensus earnings estimates that are likely to see further cuts”.