IMD monsoon forecast tentatively promising for Indian retail
today Apr 25, 2019
The Indian Meteorological Department has forecast a near-normal monsoon this year which is tentative good news for jewellery businesses and India’s retail industry as a whole.
“There is good news- the monsoon is likely to be near normal,” the Ministry of Earth Sciences’ secretary M Rajeevan said in a statement when releasing the IMD’s first monsoon forecast of the year. “The rainfall in the four-month season from June to September is likely to be 96 percent of the 50-year average of 89 cm with a model error of plus or minus five percent."
This is good news for agriculture which means good news for the jewellery industry, should the forecast prove true. As summer crops account for almost half of India's food output according to the Hindu, how crops fare in the monsoon affects the whole economy. Monsoon delays cause food prices to rise which leads to inflation. However, if the monsoon is plentiful, rural surplus leads to more gold jewellery purchases.
A weak monsoon means less money in rural households and, as gold is a traditional investment purchase for rural families, the effects of the monsoon on crops also affect jewellery purchases, according to data published on The Hindu Businessline.
The IMD forecast follows a dry 2018 that even saw drought in several states including Karnataka, Gujarat, Telangana, Rajasthan among others. However, although this year’s forecast is decidedly better, with 39 percent probability of a normal rainfall, how the rain is distributed will also factor into its effects on the economy.
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