American brokerage BofAMl on Thursday said it expects a pick-up in the note ban affected rural demand from October this year. Second consecutive bumper crop on good monsoons, farm loan waivers and lower agri input costs will help revive the rural demand, the Bank of America Merill lynch note said.
“We see a strong pick up in rural demand as the autumn kharif harvest comes in October. We had turned bullish on rural demand in July 2016 after being bearish since early 2012. While 2016 kharif farm income jumped 23.3 per cent, rural demand was hurt by the demonetisation shock,” it said. It estimates the incomes from the summer crop to rise 5.3 per cent this year on good rains which are going 101 per cent of the normal that should result in the second consecutive bumper harvest, after multiple years of drought impact.