Industry is demanding a cut in repo rate to help revive India's sagging GDP growth that hit decade's low of 4.5 per cent in the third quarter of 2012-13.
Search panel to shortlist candidates soon.
Reserve Bank of India Governor D Subbarao on Tuesday said the central bank needed more powers before it could firm up the final guidelines on new bank licences.
RBI is scheduled to announce mid-quarter review of monetary policy for 2013-14 on June 17.
The RBI has fixed the reference rate for the US dollar at 54.8260 and for euro at 72.8285.
Expectations for a rate cut had gathered momentum this week after inflation slowed to its lowest level in three years.
He was the financial secretary when the 2G licences were allocated.
A cut in the CRR will help banks release their funds stuck with the RBI on which they do not get any interest from the regulator.
These banknotes will bear the signature of RBI Governor D Subbarao and the year of printing 2012 will be on the reverse of the banknote.
Making a case for raising prices of diesel, kerosene and LPG, the Reserve Bank on Tuesday said hike in rates of petroleum products is necessary to arrest fiscal slippages.
The recent fall in commodity prices might not be sufficient to bring down the country's widening current account deficit
Banks will ask the banking regulator to defer the higher provisioning norms on standard restructured advances.
The majority votes came at a time when Subbarao had been holding the repo rate in the last four monetary policy reviews.
The RBI chief further said the state Chief Minister Oommen Chandy had told him that there were several NRIs in Kerala who wanted to contribute to the development of the state and that there should be a mechanism for channelising their funds.
In an interview with the Press Trust of India on Sunday, Finance Minister P Chidambaram explained that there was no "antagonism" between his ministry and the Reserve Bank of India (RBI).
The last time RBI allowed new private banks was in 2002, prior to which it allowed new players in the mid-90s.
Said to be considering a 2nd term for RBI deputy governor
He said there is also need for raising agriculture productivity, and improvement of social sector outcome.
The RBI said that strong signs of fiscal consolidation are necessary to create a space for lowering policy rate without the risk of resurgent inflation.
The central bank says that there is room for policy action, but warns of persistent inflation risks.
India Inc's reactions to the RBI rate cut.
In its Third Quarter Review of Monetary Policy 2012-13, the Reserve Bank of India has reduced the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 8.0 per cent to 7.75 per cent with immediate effect.
The government had last week hiked diesel prices by Rs 5.63 a litre and capped the number of subsidised LPG cylinders to six per family a year.
Accepting that inflation had increased in past few years, the RBI governor said that though they had somewhat succeeded in containing it in past two years, it is still there.
Subbarao said there was need to bring inflation to 5 per cent saying the relationship between growth and inflation is non-linear.
As India seeks to control high inflation, RBI Governor D Subbarao has said a little sacrifice in growth is "inevitable" amid efforts to bring down prices to acceptable levels.
Inflation as measured by the Wholesale Price Index stood at 6.87 per cent in July, down from 7.25 per cent in June. It is still much above RBI's comfort level of 5-6 per cent.
While many feel PPI would not be a feasible idea for India considering shortcomings like data collection for agriculture commodities, some analysts say the new index could be experimented at least with the manufacturing sector.
Subbarao was delivering the second Business Standard Lecture in New Delhi, immediately after releasing Business Standard India 2011, the fourth volume of the annual India series published by BS Books, a division of Business Standard Limited.
India's headline inflation has been high, forcing RBI to keep policy rate unchanged since April.
The central bank cut SLR to 23 per cent from 24 per cent.
Due to tight liquidity condition, RBI would cut cash reserve ratio.
The word 'balancing' seems to be a favourite of Reserve Bank of India Governor D Subbarao.
Subbarao, who was the Finance Secretary from April 2007 to September 2008, is a key witness in the case in which former Telecom Minister A Raja and others are facing trial.
Subbarao's decision to keep interest rate unchanged at the policy review last month to contain inflation evoked criticism from industry and the government.
The Producer Price Index will be better able to measure the average change over time in the sale prices of domestic goods and services, the Reserve Bank Governor said.
SBI Chairman Pratip Chaudhuri on Tuesday once again expressed his open disagreement with the RBI on cash reserve ratio (CRR) saying it is a "waste" for the economy and successive interest rate cuts by central bank have failed to contain inflation.
The governor had just made an elaborate presentation in defence of the central bank's decision to not to succumb to industry's demand for rate cuts in the mid-quarter policy.
The governor had just made an elaborate presentation in defence of the central bank's decision to not to succumb to industry's demand for rate cuts in the mid-quarter policy.
These bank notes will bear the symbol on the observe and the reverse with inset letter E.
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