2023-10-09 11:38:08 am | Source: PR Agency
The impact of the Israel Hamas war on market volatility By Dr. Manoranjan Sharma, Infomerics Rating
Below the on The impact of the Israel Hamas war on market volatility By Dr. Manoranjan Sharma, Chief Economist, Infomerics Ratings
The surprise Israel-Palestine war would have wide-ranging ramifications and repercussions across geographies, economies and sectors. There will be volatility in the bond and equity market temporarily. Bond yields will harden, cost of credit may go up for companies, crude price will rise if it spills over to middle East. Gold may become a safe haven.
Bond yields will go down -- as interest rates will rise further, oil prices will go further up. This would impact the Indian capital market, the banking sector, the trade deficit, the current account deficit and also to a limited extent, the fiscal deficit.
All this depends on the severity of the Israeli counterattack and the duration- does it end swiftly with a crippling blow to Hamas or it drags into a long-protracted war, e.g., Russia -Ukraine war?
My sense is for a swift, bloody war and Hamas to get a debilitating blow. But this is an evolving situation and would further heighten geo-political tensions, which were already exacerbated by the Russia-Ukraine war and the posturing or worse in the Taiwan region.
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