Markets

Aug 12th 2023 - ₹2,540,181.00

Year to Date - 78.63%

Since Jan 1st 2022 - 31.53%

Aug 12th 2023 - ₹157,474.00

Year to Date - 52.30%

Since Jan 1st 2022 - 46.62%

Market Summary

Macro

• The Reserve Bank of India kept the repo rate unchanged at 6.5% on August 10. However, it hiked CPI inflation forecasts for FY24 from 5.1% to 5.4%. As a result, the decision is seen as a hawkish pause.

• US Inflation rates stayed under control - with the CPI-U (for All Urban consumers) 0.2% for the month of July, rising 3.2% for 12 months ending July.

• China fell into deflation with the official CPI index falling 0.3% in July vs year ago. Chinese exports & imports also dropped double digits in July, increasing the concern about the Chinese economy.

Digital Assets

• Coinbase's Base network has officially launched, marking the end of its "builders only" phase. The network, which aims to onboard more users into Web3 protocols, offers various functionalities. Users can bridge Ether from mainnet to Base, swap tokens, and provide liquidity through decentralized exchanges like Uniswap, Maverick Protocol, and LeetSwap. A payment app called Beam allows users to make payments using U.S. Dollar Coin or the app's native coin, Eco. Moreover, NFTs from brands like Coca-Cola and Showtime can be minted exclusively on Base.

• PayPal has introduced a new stablecoin named PayPal USD (PYUSD), launched on August 7. This U.S. dollar-pegged digital currency is backed by real U.S. dollar deposits and short-term US Treasurys. It operates on the Ethereum blockchain and is designed for digital payments and Web3. PYUSD can be redeemed for U.S. dollars anytime, traded for other cryptocurrencies on PayPal, and transferred between PayPal and Venmo. With over 350 million users, PayPal aims to integrate PYUSD into the payments infrastructure. Unlike existing stablecoins, this is the first to be launched by a major payment processor.

Interesting Finds

• Martin Tarlie of GMO discusses how to bridge the gap between financial planning & portfolio management.

  Key point: If you define risk not as volatility, but as ‘not having what you need, when you need it', the approach to investing can change significantly.

• With U.S. interest rates staying high, their implications on the US economy given high US budget deficits & debt levels are scary. The Congressional Budget Office regularly updates its long-term budget forecasts and says that U.S. debt held by the public will surpass gross domestic product this fiscal year and that interest on that debt will equal about three-quarters of discretionary, non-defense spending.

Regards,

The BrownRice Capital Team

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.