In his first monetary policy review since taking office on September 4, RBI Governor Raghuram Rajan increased the repo rate by 25 basis points to 7.50 per cent.
Reversal in the declining economic growth trajectory is clearly the need of the hour and all steps should be taken to bring about this change.
Consumer prices rose an annual 5.11 per cent (2012 base) in January.
The Reserve Bank on Thursday said that the overall stance of its monetary policy for this fiscal would continue to accord a high-priority to price and financial markets stability and well-anchored inflation expectations.
The Reserve Bank of India on Wednesday retained its growth projection at 7.2 per cent for the current fiscal on the back of improvement in urban demand and gradual recovery in rural India. Unveiling the third monetary policy for the current fiscal, RBI Governor Shaktikanta Das said the Indian economy remained resilient, and the central bank will continue to support growth. The RBI expects growth in the first quarter of the current fiscal at 16.2 per cent, which will taper to 4 per cent by the fourth quarter.
The 30-share S&P BSE Sensex ended up 130 points at 25,400 and the Nifty50 rose 46 points to close at 7,759.
Equities went into a tailspin on Wednesday after the Reserve Bank surprised the market with a mid-cycle rate hike in a bid to tame soaring inflation.
Unless RBI temporarily relaxes the norms on recognising of bad loans, the pressure on this front could rise in the December quarter.
Reserve Bank of India (RBI) Governor Shaktikanta Das said on Friday said the central bank has developed an innovative artificial intelligence and machine learning (AI/ML) based model MuleHunter.ai to address the growing issue of mule bank accounts that are often used for committing financial fraud. Developed by the Reserve Bank Innovation Hub, the new initiative is piloted with two public sector banks.
Sectoral performance was mixed with media and PSU banking stocks attracting buyer interest and healthcare, FMCG and metal stocks bearing the brunt of the bears
Reserve Bank is scheduled to announce its bi-monthly monetary policy on August 3.
A combination of farm loan debt waivers by state governments and the implementation of the pay commission award could entail some fiscal slippages and pose a risk to inflation
Investors' wealth soared by Rs 10.58 lakh crore in three days of the market rally, where the BSE benchmark jumped over 2 per cent, and hit an all-time high on Monday. Extending its winning momentum to the third day running, the 30-share BSE Sensex jumped 363.20 points or 0.49 per cent to settle at 74,014.55. During the day, it zoomed 603.27 points or 0.81 per cent to hit its record high of 74,254.62.
IT and interest rate-sensitive bank, realty, and auto stocks ended with sharp gains.
From the 30 Sensex firms, Tata Steel, JSW Steel, Power Grid, HDFC Bank, Tata Motors and Larsen & Toubro were the biggest gainers. Hindustan Unilever, Infosys, Bajaj Finance, Axis Bank, Kotak Mahindra Bank and UltraTech Cement were among the laggards.
From the Sensex pack, IndusInd Bank, NTPC, Asian Paints, Hindustan Unilever, JSW Steel, Tech Mahindra, Bajaj Finance, Infosys, Wipro, ICICI Bank, Bajaj Finserv, HDFC Bank and Tata Motors were among the major laggards. HCL Technologies, Power Grid, Titan, Reliance Industries, UltraTech Cement, Tata Steel, State Bank of India and Mahindra & Mahindra were the gainers.
IT shares hold on to gains while power, metals lag.
Deputy governors Subir Gokarn, Usha Thorat and Shyamala Gopinath will get additional portfolios, which were until now under K C Chakrabarty, RBI said in a statement today. The central bank did not give any reason for the reshuffle and said the changes will be effective tomorrow.
The Reserve Bank of India's (RBI's) record surplus transfer to the government has raised hopes among bond traders that the government might reduce its gross borrowing for the current financial year (2024-25/FY25) by up to Rs 1 trillion. The RBI approved a dividend of Rs 2.11 trillion for the central government for 2023-24, marking an increase of roughly 141 per cent from 2022-23 (FY23). In addition, the contingency risk buffer has been raised to 6.5 per cent from the previous 6 per cent.
Indian capital markets joined the global sell-off sparked by China growth concerns
President-elect Donald Trump's warning that BRICS countries will face 100 per cent tariffs if they choose to move away from the US dollar is unclear to what extent he will carry out his threat, as it remains to be seen if the US laws permit such an action, former RBI Governor Duvvuri Subbarao said on Monday. He also said even for BRICS, there are internal differences about bringing out an alternative to the US dollar.
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Stating that there are strong inter-linkages between banks, NBFCs and other deposit-taking entities, he said for monetary policy to be effective and financial markets to remain stable, they should be regulated by the central bank.
Policy rates have been reduced substantially in 2015.
Balance is needed in selecting members for the proposed monetary policy committee, says Abheek Barua.
Industrial countries cannot at this point wash their hands off developing economises and say we will do what we need to, and you do the adjustment you need to, says RBI Governor.
With inflation remaining high, the Reserve Bank on Monday indicated that it may go for another round of interest rate hike on Tuesday even though the step may impact the economic growth.
Unhedged exposure of the corporate poses a risk and overall percentage of hedging remains low.
The status quo decision came as a breather as only last week the RBI had pulled up banks for not helping it in monetary policy transmission.
Retail inflation eased to an 11-month low of 4.83 per cent in April as prices of some kitchen items declined though overall food basket firmed up marginally, according to a government data released on Monday. The Consumer Price Index (CPI)-based retail inflation was 4.85 per cent in March. It was 4.7 per cent in April 2023.
As per the RBI Act, the central bank should have four deputy governors - two from within the ranks and one commercial banker and the fourth one an economist to head the monetary policy department.
Titan surged 2.98 per cent, followed by IndusInd Bank, ITC, JSW Steel, Infosys, Tech Mahindra, Tata Consultancy Services and Maruti. Hindustan Unilever, Asian Paints, Bharti Airtel and HDFC Bank were among the laggards.
The MPC states that the 4 external members will have a tenure of four years each.
Wholesale inflation in the country rose for the fourth consecutive month in June at 3.36 per cent on account of rise in prices of food articles, especially vegetables and manufactured items. The wholesale price index (WPI) based inflation was 2.61 per cent in May. It was (-) 4.18 per cent in June 2023.
Describing the annual monetary policy announced by RBI Governor D Subbarao as a progressive one, Ernst & Young India's Ashvin Parekh said, "We have almost reached a point where inflation has become unmanageable and RBI has clearly indicated that bringing down inflation to a comfortable level is its top priority."
Reserve Bank of India Governor Raghuram Rajan said, in an election year, it is better to be ready for any eventuality.
Concerned over elevated inflation, Reserve Bank of India on Friday decided to leave the benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance, implying more rate cuts in the future if need arises to support the economy hit by the Covid-19 pandemic.
The Reserve Bank's annual monetary policy will moderate inflation without hurting growth, while providing relief to small housing loan borrowers, Finance Minister P Chidambaram said on Tuesday.
Rajan had cautioned against any deviation from the fiscal discipline path.
Governor Raghuram Rajan lowered the benchmark repurchase rate to 7.75 per cent from 8 per cent, the first reduction since May 2013.
