SHOWS: HONG KONG, CHINA (AUGUST 23, 2013) (REUTERS - ACCESS ALL)

ANDREW ECONOMOS, HEAD OF SOVEREIGN & INSTITUTIONAL STRATEGY, JP MORGAN ASSET MANAGEMENT

1. REPORTER OFF CAMERA SAYING:

'Will the situation get worse on the rupee and the markets after the September policy? Or has the market priced that in already so we can be prepared for a post policy rebound?'

2. ANDREW ECONOMOS SAYING:

'I think the market is anticipating much of it. And the rupee is overreacted. It's increasing the relative competitiveness of India. But it's still a domestic demand-related economy, so exports are not on the big part of it. So I think you'd continue to get some volatility. My guess, however, is with the new central banker Mr. Rajan - plus, the government is starting to decrease its populism and start increasing, obviously, this move towards more liberalization and reform - we'll start to see better news out of the Indian market. Technically it's oversold, so we should get a bounce anyways. And I think that's what we've been seeing the last couple of days.'

3. REPORTER OFF CAMERA SAYING:

'India has worked hard to avert a ratings downgrade. Is that inevitable in this scenario? What will be the impact of that?'

4. ANDREW ECONOMOS SAYING:

'No I don't think it's inevitable. I think there's a lot of confidence in the foreign community in the RBI, the Reserve Bank of India. We'll wait and see. But seems like the new head is a very capable economist, understands the business extremely well, good macro. And obviously understands the industries and micro well. He knows what they've got to do, knows what he has to do. So I think the re-rating will wait. The de-rating will wait until we see the RBI falter. Or we see the populism rears its ugly head and again reform and liberalization slow down.'

5. REPORTER OFF CAMERA SAYING:

'What do you expect on the rupee against the dollar? Is 70 or beyond possible?'

6. ANDREW ECONOMOS SAYING:

'No I think we've stabilized on the currency. I think you've probed the depths. Currencies have the tendency to overreact to the downside as well as to the upside. And I think the rupee has been a case in point. I think most FX short-term traders and the longer-term funds will start to, or long-term horizon funds will start to focus on buying here at this level. It looks like it should be set up for a technical bounce. That's not to say it might plunge a little bit more. But in my mind I think technically we are at a pretty good level here. And it should hold.'

7. REPORTER OFF CAMERA SAYING:

'Do you believe 2014 will be good for India and emerging markets in terms of what will drive interests?'

8. ANDREW ECONOMOS SAYING:

'Yes I do. You got to step back a little bit in terms of overall asset allocation - look at those big level one or tier one decisions. I think 2014, going into 2015 will be quite good in equities in general. So we will see that massive rotation away from fixed income as yields start to normalize back into equities. We still have fairly modest non-inflationary growth around the world. Things are recovering. We should see a pickup in profits. You should see a pickup in exports and domestic demand in general. And I think that's going to behoove or benefit emerging markets. India will, of course, catch a bit on the back of that. So all this is being set up for a really good buying opportunity. The problem is - how do you stomach the volatility short term? And does it look like the rupee and the Nifty or the Sensex are in free fall? I would argue that they are not - I think we've kind of, we are bouncing along the bottom here.'

9. REPORTER OFF CAMERA SAYING:

'What is your growth expectation from India for this year?'

10. ANDREW ECONOMOS SAYING:

'Well you know, it's a tough one. I think we just have to manage down our expectations for emerging markets in general. That not just India but also China - I think they are big economies, and they are going to go into a period of slower but still very good relative growth. So four and half to five percent GDP growth, may be five and a half to six percent in China. And as a result, we have to expect less from the economies that are much bigger. However that said, on a relative basis, they will stack up still quite nicely against the developed market. Will they sustain a critical growth path enough to justify and continue to absorb their population? In India in particular, that remains to be seen. But I think China, five and a half to six percent should be pretty stable.'