Maneesh Dangi on why Indian inflation is likely to be stickier at higher level

economictimes.indiatimes.com:

Maneesh Dangi, Macro Mosaic Investing & Research, says «over a medium term, China will continue to disappoint. But relative to market expectations, when at least in India, the general popular view would be that China is in a doom loop and perhaps is having a recession, that is not true. China is likely to grow at 4-5% over the next many years.

In the US, the opposite is true. The hard data continues to surprise markets on the higher side and also the policymakers. The good news there, of course, is that inflation is dropping but markets are circumspect whether durable 2% inflation would be achieved in the next 6 to 12 months’ time.»Let us start with the two recent points which is making markets a bit nervous – one is that news flow coming out of China; there seems to be some nervousness and urgency among the policymakers there – be it capital market, be it cutting rates; on the other hand, extremely strong data set is coming out of US, the economic indicators. How are you reading both of these?In China, there is a serious struggle with respect to the growth model itself.

So, while policymakers are trying to address the financial part of it which is do not sell stocks, ease interest rates and so and so forth, the real worry in China for the last couple of years and over the next many years and perhaps a decade would be how to change the growth model and we still do not hear anything from them yet in terms of how they are going to lean against investing led growth model to consumption led. It is still a sort of a thing which is not very sure. So, over a medium term, China will continue to disappoint.