The big stories of the week ahead—in charts

1. India Inflation

India is set to release consumer price inflation numbers on Friday. After touching a record high of 7.79% in April, retail inflation has shown a mild declining trend over the past two months. The inflation rate marginally fell to 7.01% in June from 7.04% in May.

Yet, the number has remained above the upper tolerance band of the Reserve Bank of India (RBI) for straight six months starting from January this year. Analysts expect inflation to moderate in July, led by a decline in soaring food prices coupled with the effect of fuel tax cuts announced by the government in May. “We expect food inflation to moderate to 6.6% y/y in July, from 7.6% in June, as sequential momentum is likely to stay flat," Barclays said in a note on 3 August.

On Friday, the monetary policy committee raised the repo rate by 50 basis points in a bid to check retail prices and the central bank governor admitted to inflation remaining “unacceptably high".

2. Monsoon Session

This marks the last week of the ongoing Monsoon Session of Parliament. The session, which began on 18 July, has been marred by disruptions leading to a productivity of just 44% in the Lok Sabha and 39% in the Rajya Sabha so far, according to PRS Legislative Research.

Opposition members have protested for reasons ranging from inflation, a rise in goods and services tax rates, and the alleged misuse of government agencies. The protests even led to the suspension of as many as 27 MPs in the Rajya Sabha and four Congress MPs (which was later revoked) in the Lok Sabha for “unruly behaviour".

The disruptions meant that only a limited number of bills could be passed so far: six in the Lok Sabha, four of which also made it through the Rajya Sabha. One of the key highlights so far has been the government’s decision to withdraw the data protection bill in favour of a revamped one to be tabled later.

3. US inflation

Retail inflation in the US continues to shatter records, touching a fresh four-decade high of 9.1% in June. The data for July will be released on Wednesday, and will be of interest to Indian markets as well. So far, the Federal Reserve’s response to inflation, in the form of rate hikes, has kept investors in Indian equities on tenterhooks. However, the Fed’s commentary last month was seen as indicating slower rate hikes going forward, helping Indian stock indices make gains.

At the heart of the changing commentary is the fear of a recession. While soaring demand and war-led disruptions have lifted the cost of living, they have also aided a slowdown. The inflation problem that began last year has now transformed into a classic inflation versus growth dilemma for central bankers. The inflation figures for July will further inform the Fed’s actions.

4. Airtel earnings

Bharti Airtel, India’s second largest telecom operator, is scheduled to release its earnings for the June quarter on Monday.

The company will announce its results two weeks after India concluded its first-ever auction of 5G spectrum, in which Bharti Airtel emerged the second-highest bidder after Mukesh Ambani’s Reliance Jio.

Analysts forecast a 1-3% sequential revenue increase for the quarter, boosted by limited mobile broadband upgrades and the residual impact of a near 20% tariff hike undertaken by the telco in November last year.

The company put up a stellar show in the March quarter by posting a strong 164% growth in its consolidated net profit, while its average revenue per user (ARPU)—a key performance indicator in the telecom industry—also increased, surpassing rivals Reliance Jio and Vodafone Idea. Analysts at Motilal Oswal expect Airtel’s ARPU to increase 3% sequentially, aided by the tariff hikes.

5. Oil co earnings

Public sector oil and gas explorers Oil India Ltd (OIL) and Oil and Natural Gas Corp (ONGC) will report their June-quarter financial earnings on Wednesday and Friday, respectively.

Analysts expect that increased crude oil prices will bode well for the growth in earnings for both companies. However, volume growth is likely to be muted, according to Prabhudas Lilladher. The brokerage has pegged a 240% year-on-year profit growth for ONGC, and 264% for OIL. The profit growth in the March quarter was 32% and 92%, respectively.

Oil companies globally have benefited greatly from the surge in energy prices, which have been on the boil since Russia’s war on Ukraine began earlier this year. Now, crude prices have corrected to some extent though they remain elevated. The companies’ commentary on future trajectory will be key to watch out for.