RBI Governor D Subbarao says banks' response to RBI's monetary intervention is asymmetric.
The criticism that the Reserve Bank of India was behind the curve in hiking interest rate to tame rising inflation is unfair, former RBI Governor D Subbarao said on Wednesday and asserted that it is difficult for any central bank to anticipate the future more accurately. Earlier this month, Monetary Policy Committee (MPC), the central bank's rate-setting panel, surprised the markets with a 40 basis points hike in repo rate in an off-cycle policy meeting. It was also the first rate hike after August 2018, amid spiralling inflation.
Former Prime Minister Manmohan Singh's 1991 budget unshackled India's economy, significantly enhancing the economic prospects for hundreds of millions of Indians, first deputy managing director of the International Monetary Fund (IMF) Gita Gopinath said on Friday.
'The prime minister's comment on 'revdi culture' was welcome. But I am disappointed he did not follow up on that.' 'All political parties, including the BJP, have been guilty of this.' 'Now, Modi's guarantees, the Congress's 'nyay' path and both ruling and Opposition parties are vying with each other for freebies in my home state Andhra Pradesh.'
If numbers change, there will be scope for more rate cuts.
Of the eight RBI governors who have held office since the 1991 economic liberalisation, Bimal Jalan had the longest stint and S Venkitaramanan, the shortest. Current Governor Shaktikanta Das will overtake Bimal Jalan before completing his second term in December, points out Tamal Bandyopadhyay.
Former RBI governor D Subbarao has suggested that the government should come up with a 10-year road map for privatisation of all Public Sector Banks (PSBs) as it would provide much needed predictability to stakeholders. Subbarao further said that the big bang approach to privatisation of state-owned banks is not desirable but at the same time the issue should not be put on the back burner. "Ideally, we should have a road map, maybe over a 10 year timeframe, to privatise all PSBs. "That will give much needed predictability to all stakeholders," he told PTI.
Former RBI governor D Subbarao on Monday said there is a strong motivation for the central bank to launch a digital currency and cash is going to coexist with the new-age currency. Addressing an event virtually organised by economic think tank NCAER, Subbarao further said cybersecurity is also one of the downside risks of the Central Bank Digital Currency (CBDC). "There is a strong motivation for the RBI to launch CBDC... Cash is going to coexist with CBDC," he said.
New notes bearing signature of former Governor D Subbarao are legal tender and the process of changing signature is underway
Ending months of suspense, Prime Minister Manmohan Singh on Tuesday gave a two-year extension to RBI Governor D Subbarao beyond September.
Reserve Bank Deputy Governor Michael Patra on Wednesday said the central bank's views about cryptocurrencies might have delayed the government's proposed legislation on crypto assets. Emphasising that the Central Bank Digital Currency (CBDC) will be introduced in FY23 as announced by Finance Minister Nirmala Sitharaman in the Budget speech, Patra said India will proceed very gradually on the subject as there are concerns on privacy, its impact on monetary policy formulation and energy intensity. The government had plans to introduce a bill on cryptocurrencies like Bitcoin during the Winter Session of Parliament in November-December 2021 but did not introduce it.
Along with the Finance Minister, the country looks up to RBI Governor in times of crisis. Among the last five chiefs, who have lived up to the people's expectations? Find out...
Traditionally, Prime Minister picks the RBI Governor after consultation with the finance minister.
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Rapid depreciation of the rupee put us in a vicious spiral: D Subbarao
Moody's has cautioned the government against targeting double-digit gross domestic production expansion saying any growth beyond 7 per cent without reforms will fuel inflation that will result in 'more painful' future adjustments.
Guidelines say that new banks need to set up 25 per cent branches in unbanked areas.
Slowdown in growth is the most worrisome factor and volatile capital flows have made the country vulnerable to "stops and reversals", RBI Governor D Subbarao said.
Central bank Governor Raghuram Rajan drew kudos from Moody's Analytics for his monetary stance.
Reserve Bank of India governor D Subbarao on Thursday said that India's central bank needs to control inflationary expectations and support growth.
When it comes to running between the wickets -- which is exactly what an FM and a governor do -- Jadeja always defers to Dhoni's larger judgement of the situation and the needs of the team, observes T C A Srinivasa-Raghavan.
Recent financial crisis underscored the dangers of over-financialisation of the real economy.
A revival in investment activity, which is key to stimulating growth, depends particularly on the recent policy announcements by the government being translated into effective actions, Subbarao said while announcing the second quarterly review of the monetary policy.
In the wake of ponzi schemes and chit fund scams, Reserve Bank Governor D Subbarao on Wednesday said there is a need to review the regulations governing these sectors and increase surveillance on such entities.
RBI had launched the investigation into the working of banks following the expose which showed some bankers giving suggestions to customers on ways to bypass regulatory norms.
The third-quarter monetary policy review is keenly watched by the industry as well as the market because the central bank has not lowered the key interest rate (repo rate) since March on concerns of inflation.
Raghuram Rajan becomes the 23rd governor of Reserve Bank of India.
In a meeting hosted by US India Business Council on Thursday night, the American industry leaders also discussed with Subbarao the need for maintaining 100 per cent foreign ownership of wholly-owned subsidiaries, and transparent priority sector lending norms.
The Reserve Bank on Tuesday lowered the growth projection for the current fiscal to 5.5 per cent from its earlier estimate of 5.7 per cent and asked the government to undertake policy measures to improve investment climate.
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Tata Sons, India's biggest business group, and firms controlled by billionaires Anil Ambani and Kumar Mangalam Birla are among the 26 companies that have applied for licences to open banks.
Ahead of its mid-quarter policy, the Reserve Bank on Friday said its monetary actions in the coming months will be determined by the outlook on monsoon and ensuing impact on inflation.
Conceding that there has been risk aversion among the lenders stemming from their rising asset quality concerns, the Governor said banks should lend to productive sectors, notwithstanding the importance of asset quality, by being discerning.
Officials, however, said one person's thinking might not change the views of the institution.
According to Subbarao, the lower your reserves dip, the more vulnerable you become.
This was the first meeting between the RBI Governor and Chidambaram following his taking over the charge of the Finance Ministry last week.
RBI raised lending rates to commercial banks 2 per cent to 10.25 per cent making loans costlier.
His comments poured cold water on hopes that the central bank may have a rethink on rates after the wholesale price index, the main inflation gauge, rose a lower-than-expected annual 7.25 per cent in June, its slowest rise since January, helped by moderation in fuel prices.
A day after Chidambaram asked RBI to speed up the process of issuing new bank licences, Subbarao said last Friday that it would not be possible without fulfilling the enabling conditions for the same.
The rupee has declined by about 9 per cent in the past three months and had touched an all time low of 61.21 to a dollar earlier this week.
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