The RBI, had, earlier in the day, hiked CRR by 0.75 per cent in two tranches, a move, it said, would help flush-out Rs 36,000 crore (Rs 360 billion) from the system.
Industry on Tuesday hailed Reserve Bank of India's softening of interest rates in the Credit Policy 2003-04 and \n\nhoped it would lead to further cuts in lending rates of banks giving enough incentives to spur industrial production.
At a meeting with chairmen and managing directors of public sector banks, Chidambaram asked them not to overprice loans to FMCG and automobile sectors.
Here are the 10 biggest falls in the Indian stock market history:
The Sensex opened with a negative gap of 260 points to 12,812.
Ahead of its annual monetary policy scheduled next month, the RBI in a sudden move hiked the repo rate and Cash Reserve Ratio** to 7.75 per cent and 6.5 per cent, respectively to suck out about Rs 19,500 crore (Rs 195 billion0 from the system.
The banking industry could witness another round of prime lending rate hikes beginning next week, a top Indian Banks' Association official said on Wednesday.
The Bank Rate (6%), Repo Rate (7.75%) and Reverse Repo Rate (6%) have all been left unchanged in the half-yearly review of the monetary policy on Tuesday.
Concerned over surging inflation, Reserve Bank of India hiked the short-term repo rate on Wednesday by 0.25 per cent to 7.50 per cent while keeping reverse repo, bank rate and cash reserve ratio unchanged.
'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 NSE Nifty slumped to a low of 4,833, and finally settled with a heavy loss of 155 points at 4,853. The index has shed 422 points (8%) in the last six day. The market breadth too was extremely bearish, with nearly eight stocks for each advancing stock. Out of 2,944 stocks traded, 2,582 declined and 337 advanced on Wednesday.
Reserve Bank of India Governor Yag Venugopal Reddy presents the First Quarter Review of Annual Statement on Monetary Policy for the Year 2006-07.
Breaking the streak of continuous fall in outstanding amounts, non-resident Indian (NRI) deposits rose for the first time in the financial year to $134.54 billion in October 2022. The figure was $133.67 billion in September. Reserve Bank of India (RBI) data showed that NRI deposits were in shrinking mode for the first six months of FY23. They fell to $133.67 billion in September from $139 billion in March.
RBI will be cautious easing rates further given oil price uncertainties
At its monetary review on Tuesday, the RBI raised the statutory liquidity ratio by 1 percentage point to 25 per cent and discontinued the special repo facility for banks to provide liquidity to mutual funds and others.
Highlights of the RBI monetary policy.
Financial services firm AnandRathi analysed the key points of the policy soon after it was announced.
The banking system's liquidity slipped into deficit for the first time in the current financial year (2023-24) due to the imposition of the Incremental Cash Reserve Ratio (I-CRR) for banks and outflows from goods and services tax (GST) payments, according to dealers. Reserve Bank of India (RBI) data shows it injected Rs 23,644 crore on August 21. The last time liquidity was in deficit was on March 27, when the RBI injected Rs 45,575 crore.
Leading industry and export chambers like PHDCCI and Federation of Indian Export Organisation on Tuesday demanded 1.0 per cent cut in bank rate and cheaper export finance in Reserve Bank of India's' forthcoming busy season credit policy.
The Reserve Bank of India on Tuesday left all the key interest rates unchanged in the first quarterly review of the monetary policy.
Key share indices ended over 1 per cent higher on Tuesday led by rate sensitive shares as the sluggish April IIP data re-inforced market expectations that the central bank could cut key policy rates and also lower the cash reserve ratio to boost growth.
The Reserve bank of India has just increased its repo rate and CRR and there are chances that banks may soon increase the interest rates on home loans.
A spiralling inflation is likely to force the Reserve Bank of India to up the Cash Reserve Ratio by 0.75 per cent in FY 09, along with a 1 per cent hike in repo and reverse repo rates, global financial services major, StanChart said.
The Reserve Bank of India (RBI) on Monday directed banks and non-banking financial companies (NBFCs) offering gold loans to thoroughly review their policies, processes, and practices to identify any gaps. The central bank also told them to closely monitoring their gold loan portfolios amid significant growth observed in this segment vis--vis some lenders. Additionally, the RBI, through a circular, instructed these lenders to ensure adequate controls over outsourced activities and third-party service providers.
Interest rates on fixed rate home loans have been increased by 0.75 per cent to 8.50 per cent from the current level of 7.75 per cent with effect from November 17, 2004.
State Bank of India and ICICI Bank, two of India's largest banks, on Tuesday said that there would be no immediate hike in interest rates due to the Reserve Bank of India's decision to increase the cash reserve ratio in banks to curb inflation.
Nearly three years after the Reserve Bank of India began its move towards a soft interest rate regime, the trend is seeing a slow but sure reversal.
Planning Commission on Monday welcomed Reserve Bank of India's decision to hike cash reserve ratio by 0.5 per cent to 5 per cent saying it is the right step to suck out excess liquidity
The Reserve Bank of India has raised the cash reserve ratio of banks by 0.5 per cent to 5 per cent of their net demand and time liabilities (NDTL), in two stages beginning fortnight September 18.
As far as the Indian households are concerned, although the leverage ratio in this basket has multiplied nearly 3 times in the past decade, it is still well below not just developed but also most other developing economies.
The Reserve Bank of India has left bank rate and cash reserve ratio unchanged at 6 per cent and 4.5 per cent, respectively.
This is the fourth consecutive time that the RBI has kept key interest rates unchanged despite clamours from the industry to cut rates to boost economy.
The Reserve Bank of India on Tuesday cut the bank rate by 0.25 per cent to 6 per cent with effect from close of business hours.
Rising interest rates slows down the overall growth in the economy
Let's take a quick look at what all these terms mean to see how they affect the loan interest rates.
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