Indian markets may correct, provide better entry points: Ritu Arora

India remains the most expensive equity market in the region and amongst the most expensive globally, says Ritu Arora, Asia CEO at Allianz Investment Management

As the markets prepare for the January-March 2022-23 quarter numbers of India Inc, Singapore-based Ritu Arora, chief executive officer and chief investment officer for Asia at Allianz Investment Management, in conversation with Puneet Wadhwa, says that financial services and consumption-related sectors will lead to market recovery from here on out, galvanised by infrastructure and corporate capital expenditure (capex) investment. Edited excerpts:

Is it safe to assume that the worst is over for the global financial markets?

 

It is too early to announce that the worst is over. Concerns around systemic risks from the fastest rate-hiking cycle since the 1980s, higher-for-longer rates, geopolitics, debt issues in certain emerging markets (EMs), and impending growth slowdown could result in continued volatility.

Central banks should continue to proactively intervene, wherever needed, to safeguard the financial system from a contagion risk.

 

Is a cut in interest rates by global central banks on the cards?

Aggressive rate hikes may not be required from here on out. Central bank decisions on rate pauses/cuts should largely be motivated by core inflation and economic conditions in their respective domestic economies.