Nomura readies Eco Surprise Index for India

Leading financial research and securities player Nomura India will come up with a dedicated index aimed at capturing the extent of surprise in key economic data releases with respect to market expectations.

The new index, known as the Nomura Economic Surprise Index for India (NESII), will comprise variables like various sets of numbers like the GDP, IIP, purchasing managers index, bonds, currency and equity markets, according to a Nomura Securities statement.

“The NESII essentially captures the extent of surprise in economic data with respect to market expectations. The index is designed to capture the momentum and direction of data surprises. Many economic surprise indices exist for big, advanced economies, but few exist in emerging Asia,” said Nomura India chief Sonal Varma and its economist at the securities division Aman Mohunta.

He further said correct numbers are important because markets react to surprises in economic data in relation to expectations, rather than the actual data.