The wholesale price-based inflation eased for the eighth consecutive month to 4.73 per cent in January on easing prices of manufactured items, fuel and power. The wholesale price-index (WPI) based inflation rate was 4.95 per cent in December 2022 and 13.68 per cent in January 2022. Inflation in food articles, however, rose to 2.38 per cent in January, from (-) 1.25 per cent in December, 2022.
The global turmoil in the banking sector has made analysts cautious, who advise that investors stay away from stocks of this sector till the overall sentiment improves. The recent trouble for the banking sector started with the collapse of US-based Silicon Valley Bank (SVB), Silvergate Capital and Signature Bank. On its part, Moody's Investors Service has also cut its outlook for the US banking system to 'negative' from 'stable', citing the run on deposits at these three banks that led to the collapse of these banking majors in less than a week.
'There are occasions when the prices of individual items like food raise inflation; then supply-side measures must be taken.' 'But if there is continued inflation, it means liquidity is aggravating the situation.'
The Reserve Bank of India (RBI) will maintain the policy repo rate at 6.5 per cent during its upcoming June 8 announcement, considering the easing of retail inflation in April and the potential for further decline, indicating the effectiveness of previous policy rate actions, anticipate experts. Headed by Reserve Bank Governor Shaktikanta Das, a meeting of the six-member Monetary Policy Committee (MPC) is scheduled for June 6-8. The decision of the 43rd meeting of the MPC would be announced on Thursday, June 8.
Moody's Investors Service on Wednesday raised the rating outlook for 18 Indian corporates and banks, including Reliance Industries, Infosys, SBI and Axis Bank, to 'stable' from 'negative'. This follows the upgrade by the US-based rating agency in India's sovereign rating outlook to 'stable' from 'negative' on Tuesday. The agency had affirmed the sovereign rating at 'Baa3'.
Elevated food price-led inflation could become a sore point for markets, which they seem to be ignoring at current levels, observe analysts. Retail inflation in India - as measured by the Consumer Price Index (CPI) - came in at a three-month high of 6.52 per cent in January 2023, compared with 5.72 per cent in December and 5.88 per cent in November 2022. The inflation print for February, according to Madan Sabnavis, chief economist at Bank of Baroda, will be critical for the Reserve Bank of India's monetary policy committee.
A security guard posted at the Station Road branch of Bank of Baroda in Bareilly on Friday allegedly opened fire at a customer who was trying to force his way inside without a mask, the police said.
Reserve Bank Governor Shaktikanta Das on Friday said the rupee is holding up relatively well when compared to the currencies of emerging market peers and advanced economies. Days after the domestic currency breached the 80-level against the dollar, Das said Reserve Bank of India (RBI) has zero tolerance for volatile and bumpy movement in the rupee and added that the central bank actions have helped in smoother movement. He said RBI has been supplying US dollars to the market to ensure adequate supply of liquidity and also clarified that the central bank does not target a particular level for the currency.
The finance ministry on Thursday raised concerns over the possible impact of El Nio conditions on India this year, saying if recent forecasts came true, the country could see lower agricultural output and higher inflation. "Some meteorological agencies predict the return of El Nio conditions in India this year. "If these predictions are accurate, then monsoon rains could be deficient, leading to lower agricultural output and higher prices," the ministry said in its monthly economic review.
We as customers have to be conscious and careful to sidestep numerous types of frauds made possible under a mindless shift to a digital ecosystem without customer-redress procedures, warns Debashis Basu.
The combined entity is set to be the third largest bank in India, behind State Bank of India and ICICI Bank.
'If private capex has to kick in, there should at least be 2-3 years of visibility.'
The Centre should privatise all public sector banks (PSBs), except the State Bank of India (SBI). This is because private banks have emerged as a credible alternative to PSBs with substantial market share. Also, government ownership hinders the ability of the Reserve Bank of India (RBI) to regulate the sector, according to a report by the National Council of Applied Economic Research (NCAER).
The annual earnings of a non-executive chairman of a PSB is capped at Rs 10 lakh, inclusive of fees for attending board meetings. This is way below the compensation of the chairman of any private bank, reveals Tamal Bandyopadhyay.
India's industrial production contracted by 4 per cent in October, the sharpest fall in 26 months, mainly due to decline in output of manufacturing and subdued performance of mining and power generation sectors, according to official data released on Monday. The Index of Industrial Production (IIP) had grown 4.2 per cent in October 2021. The previous low was (-) 7.1 per cent in August 2020.
The Union government could target a fiscal deficit of 5.8-6 per cent of nominal GDP for 2023-24, and it should continue its capital expenditure push and look to simplify the personal income tax regime, economists recommended Finance Minister Nirmala Sitharaman and her team during their pre-Budget interaction on Monday. Starting last week, Sitharaman had eight pre-Budget consultations this time. More than 110 invitees representing seven stakeholder groups participated in these meetings, the finance ministry said in a statement. The stakeholder groups included representatives and experts from agriculture and agro-processing industry; industry, infrastructure & climate change; financial sector and capital markets; services and trade; social sector; trade unions and labour organisations; and economists.
The central government and the Reserve Bank of India have devised a country-specific plan towards implementation of overseas trade in rupee, people aware of the matter said. To start with, a small number of banks will be allowed to manage cross-border transactions in domestic currency with a particular country. "Small countries that are dollar-deficient have shown interest in doing trade in rupee.
The pilot project for central bank digital currency (CBDC) in the retail segment went live on Thursday with the Reserve Bank of India (RBI) issuing Rs 1.71 crore to four participating banks based on their indents. The central bank has identified four banks for the first phase of the pilot - State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank - in four cities, Mumbai, New Delhi, Bengaluru and Bhubaneswar. The highest indent was received from one private sector bank.
As a percentage contributor to nominal GDP, PFCE's share was 60.1 per cent in FY23, compared with 59.6 per cent and 60.8 per cent in the two preceding fiscal years. "Although PFCE is expected to grow 7.7 per cent in FY23, we believe it is still short of a broad-based recovery. "The current consumption demand is highly skewed in favour of goods and services consumed largely by the households falling in the upper income bracket. "A broad-based consumption recovery, therefore, is still some distance away," said Sunil Kumar Sinha, principal economist with India Ratings.
Shri Ram Janmabhoomi Teerth Kshetra secretary Champat Rai said people from all communities have generously donated for the construction of the temple.
The Centre is staring at a combined shortfall of up to Rs 1 trillion in excise and Customs revenues in the current financial year (FY23) compared to the Budget estimates (BE), mainly because of duty cuts on edible oil and petroleum products. The government set a target of Rs 3.35 trillion for excise and Rs 2.13 trillion for Customs mop-up for FY23 while presenting the Budget in February. "As excise duty collection is mainly driven by diesel volumes, we might see a clear gap in the level budgeted for FY23, following the reduction in cesses on petrol and diesel in May. We are expecting somewhere between Rs 80,000 crore and Rs 1 trillion dip in excise and customs duty collections," a senior government official told Business Standard.
The proposed amalgamation will make Bank of Baroda, which will merge the other two lenders with itself, the second largest public sector bank after State Bank of India in place of Punjab National Bank.
It would be a difficult task for the Indian economy to reach the $5-trillion mark a year before the International Monetary Fund (IMF) projection of 2026-27. Pankaj Chaudhary, minister of state for finance, said in the Rajya Sabha on Tuesday that the government is taking steps to make the country a $5-trillion economy at a date earlier than the IMF's projection. In that context, it would not be difficult to meet the projection in the third quarter of FY27.
Unlike any other business, banking is a turf where the captain's role is the most critical. Often a bank is defined by the personality of the CEO who runs it. Both HDFC Bank and Kotak Mahindra Bank are the creation of their CEOs, notes Tamal Bandyopadhyay.
Since March 31, 2022, the PSBs' market cap has risen 43.7 per cent, from Rs. 7.29 trillion to Rs. 10.47 trillion. It's time for the government, the majority owner of public sector banks, to reap the benefit of the rally in bank stocks, recommends Tamal Bandyopadhyay.
The Reserve Bank will launch the first pilot for retail digital rupee in Mumbai, New Delhi, Bengaluru and Bhubaneswar on December 1, and later expand it to nine more cities in the initial phase. This follows a month after the RBI had started a pilot in the digital rupee - wholesale segment on November 1. The Reserve Bank announces the launch of the first pilot for retail digital rupee (e?-R) on December 1, 2022, the central bank said in a statement on Tuesday.
After a tumultuous past few days that almost halved value of the Adani group, embattled tycoon Gautam Adani-led conglomerate had some pressure eased on Friday as two global rating firms stuck with their calls on its credit profile and its French partner backed its investments in the group firms. Also for the first time since January 24, shares of the group's flagship firm Adani Enterprises ended in positive territory after erasing an intraday loss of 35 per cent. Adani Ports and SEZ also ended 8 per cent higher. This is after a over $100-billion rout in value of group stock since the US short seller Hindenburg Research accused Adani group of stock manipulation and accounting fraud.
'We should look at is full year's growth rather than quarter numbers.'
The CBI has initiated the action on the complaint of Bank of Baroda, which was a member of consortium led by Bank of India, which had approached the agency fearing that Kothari may flee the country like Nirav Modi and his uncle Mehul Choksi.
Collectively, the pack of 12 has posted a 50 per cent rise in profits -- Rs 25,685 crore. On a quarter-on-quarter basis (that is, September over June), the rise is 68 per cent. Public sector banks have never had such a stellar performance, explains Tamal Bandyopadhyay.
This is following revival of demand from the corporate sector and small and medium enterprises (SMEs), even as a nascent economic recovery is taking shape. Credit growth of scheduled commercial banks had accelerated to 9.2 per cent year-on-year (YoY) by the end of December 2021 after breaching the 7 per cent-mark in November, for the first time since April 2020.
Exuding confidence in sustaining the tempo of credit growth, public sector bankers said on Wednesday that consolidation in the public sector bank (PSB) space has given them a robust base to scale. The privatisation of PSBs can be done through divestment of government stake to a wider base of investors without haste. There is nothing to worry about at this point (high credit offtake) as underwriting standards and risk management are much better.
According to the Scheme of Amalgamation, shareholders of Vijaya Bank will get 402 equity shares of BoB for every 1,000 shares held. In the case of Dena Bank, its shareholders will get 110 shares for every 1,000 shares of BoB.
Reliance Industries (RIL) is likely to be the lone bidder for Mangalore-based JBF Petrochemicals, which is up for sale after defaulting on bank loans worth Rs 5,000 crore. The lenders for the second time extended the deadline for submission of bids, which had ended on August 20, as several players, including public sector companies, were redrawing their acquisition plans, said people in the know. "There were several companies which had submitted their expressions of interest (EoIs) for the company but after due diligence decided to exit the race," said a source close to the development. "The new deadline for submitting financial offers is August-end," the source said.
Country's biggest mortgage lender HDFC on Tuesday announced a festive offer in line with peers like SBI with home loans starting from 6.70 per cent. Last week, SBI as part of festival bonanza offered a concessional home loan rate of 6.70 per cent under its festive offer. This was followed by other lenders like Punjab National Bank and Bank of Baroda.
It won't be easy for the banking sector to better its performance every quarter, predicts Tamal Bandyopadhyay.
Start-ups Zomato, PB Fintech, One97 Communications, and FSN E-Commerce Ventures have entered the large-cap category after the latest reclassification exercise by the Association of Mutual funds in India (Amfi). This comes despite stocks such as PB Fintech (Policybazaar) and One 97 Communication (Paytm) trading below their issue price. Others such as Mindtree, SRF, IRCTC, Tata Power, JSW Energy have been moved from mid-cap to large-cap category.
India's unabated tryst with Russian crude oil is slowly coming to an end. The time has come for Indian refiners to navigate, creatively, the choppy waters of the post-honeymoon period, and for Indian policymakers to take cognisance of the broader impact on India from the spillover of the Russian crisis - after Washington's warning to transgressors last week. Shipments from Russia to India have averaged over 1.8 million barrels a day since February, according to data from Paris-based market analytics firm Kpler. But much of the crude shipped to India was non-sanctioned because it traded below a price cap set by the US led G-7 nations in December.
Public sector banks have raked in more profits in the three months ended June on the back of a persistent decline in bad loans and the trend may have a positive bearing on their balance sheets in the coming quarters. In the June quarter, Bank of Maharashtra (BoM) and State Bank of India (SBI) were in the lowest quartile as far as Gross Non Performing Assets (NPAs) and net NPAs were concerned, according to an analysis of the quarterly financial numbers published by the public sector lenders. Cumulatively, all the 12 public sector banks reported a profit of about Rs 15,306 crore in the three months ended June, registering an annual growth of 9.2 per cent. However, leading public sector lenders -- SBI and PNB -- posted lower profits in the June quarter.
The Reserve Bank's rate-setting panel will start its 3-day deliberations on Wednesday amid expectations of yet another rate hike of 50 basis points to check high inflation, in line with similar actions taken by other major central banks, including the US Fed. Based on the recommendations of the Monetary Policy Committee (MPC), the RBI had effected 50 basis points increase in repo rate each in June and August after raising the short-term lending rate by 40 basis points in an off-cycle decision in May. The MPC, headed by RBI Governor Shaktikanta Das, is scheduled to meet during September 28-30.
