Crude in $70-80-range best for India, not crashing prices: Arvind Sanger
Arvind Sanger, Founder & Managing Partner, Geosphere Capital Management, says India benefits from moderate crude prices, but it does not benefit when crude prices are showing weakness because there are concerns about global recession. So you should be careful what you wish for. You do not want crude to be crashing to a level that would suggest that global economies are in a concerted fashion going through a major slowdown. If crude stays moderate in the $70-80 range but does not meaningfully roll over, that would be probably the best outcome from an Indian standpoint.
What are you making of the global market construct right now? Do you think what we saw on Monday, Tuesday, and Wednesday was just a little bit of a knee-jerk reaction or an aberration in an otherwise intact bull market or do you think the global demand concerns are hinting towards maybe a slowdown across?
Arvind Sanger: The news from China has been bad for a while and keeps getting weaker and weaker. So, the Chinese news is certainly not encouraging. But on the US data, we got maybe a little bit more optimistic in the later part of August that maybe we might be able to engineer a soft landing in the US economy. The employment data this week is again, casting some nervous doubts about whether there is a risk that we could have a hard landing in the economy. So, the probability of a 50 bps in the Fed meeting two weeks from now has now gone up to 40%.
There is a 100% expectation that there will be a 25 bps cut and an additional 40% expectation that it
