Government Approves Palm Oil Scheme For Five Years

The Government has recently approved a new palm oil scheme for the next 5 years. The purpose of this scheme is to reduce import dependence on edible oil. It will cost the exchequer around Rs.110.4, out of which Rs.88.44 billion will be share of Centre and Rs.21.96 will be the share of State. 

In addition, the purpose of the scheme is to enhance productivity of palm oil by covering an additional 0.65 million hectare under oil palm till 2025-26, through which the target of 1 million hectares would be achieved. 

US FOMC minutes show that if the economy continues to recover, members are willing to start reducing the asset purchase program in CY21. The main risk of growth from the rapid spread of new Delta variants and supply chain bottlenecks affecting businesses were also highlighted. Officials have also pointed out that the trajectory of inflation is satisfactory and that the unemployment rate target is on the right track. 

On the other hand, as of the week of August 14, 2021, the number of initial jobless claims in the United States decreased by 29,000 to 348,000 (estimated 365,000). This is the lowest level since 14 March 2020 (256,000). 

Bonds: Except for Japan (stable), global yields closed down due to concerns about Delta spreads. UK’S 10Y yield has decreased the most by 3bps followed by Germany, US and China’s 10Y yield which fell by 1bps each. 10Y yield of India is trading at 6.23 per cent today, ahead of MPC minutes. 

Currency: Global currencies were closed mixed. US Dollar Index rose by 0.4 per cent to its highest level since November 2020 due to rising expectations that the Feb will reduce its asset purchase programme this year. 

Equity: Global markets were closed lower with FTSE (-1.5 per cent), DAX (-1.3 per cent), and Nikkei (-1.1 per cent) falling the most. Investor sentiment was influenced by FOMC minutes which suggest that Fed tapering may start in CY21.