Inflation on a Five year low and its impact on Sensex. !

The Inflation is at 3.07 % for the week that ended on 20th October. Event the wholesale price index is on low levels. That makes the prices affordable and cheaper to the indian consumer. But all this is happening amidst the sensex being at all time highs despite turbulences . These are clear indications of the market being driven by a lot of surplus funds coming into the systems in the form of participatory notes and foreign funds that are not directly linked to the nations core domestic product.

The oil prices on the global markets are exceeeding $85 and above and that is severely going to impact the governement policy decisions related to reviews and stability on Cash reserve ration and forthcoming monetary policy.  Interesting enough the global market cues are very mixed at the moment but sure the bulls are returning to the market as we look forward to another energetic bull run in November that can possible propel the sensex towards new highs of 20,000.

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One thought on “Inflation on a Five year low and its impact on Sensex. !

  1. Exactly 24 hrs after this post the markets have gained back the momentum and on a bullish spree advancing over 615 points on the sensex. Pls keep your shopping lists ready for some cherry picking !

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