Reserve Bank of India (RBI) Governor Raghuram Rajan's decision to cut rates last week surprised even top officials.
In a drastic measure to stem any major disruption to the US economy as a result of the coronavirus outbreak, the Federal Reserve has cut its benchmark interest rate to almost zero and said it would buy USD700 billion in bonds. The covid-19 pandemic has sickened more than 156,000 people worldwide and left more than 5,800 dead. The death toll in the US stands at 68, while infections neared 3,700.
Adani Ports, HUL and L&T gained the most, while ICICI Bank, ONGC, GAIL and Tata Steel lost the most
While Raghuram Rajan's departure under these circumstances is a pity, it would be wrong to conclude that the RBI or the economy cannot do without him.
Macro and micro environment are becoming more challenging.
'Waiting for a market correction and optimising entry time in the markets will be akin to missing the woods for the trees.'
State Home Minister Tamradhwaj Sahu said that in 2013-14, the state had received Rs 50 crore for police modernisation from the Centre. The allocation has come down to Rs 20 crore right now.
Revising up inflation bands for the central bank will hurt the poor, former deputy governor of RBI Viral Acharya said on Wednesday, terming the current 4 per cent midpoint on price-rise as a "reasonable target".
Central bank sees action as discriminatory, unfair
The National Democratic Alliance won 64 seats.
Getting out of the zero-rate armchair was overdue, and many in the market will be glad it has finally happened
Finance Minister Arun Jaitley presented the Union Budget.
Banks seems to be upset over RBI's move over rate cut.
Net sales growth for the quarter ended December (Q3FY20) was 4.5 per cent on a year-on-year (YoY) basis for companies that have declared their results so far, compared to an 8.4 per cent rise in the first half of the financial year. This indicates that there could be a further rise in days' sales of inventory.
He will be the first bureaucrat to head the central bank in almost five years.
Other members of the high-level advisory committee are former RBI Deputy Governor Usha Thorat, former Securities and Exchange Board of India Chairman C B Bhave, and Nachiket M Mor, Director of the Central Board of Directors of RBI, Governor Raghuram Rajan said.
Central banking is a science, not an art, Tamal Bandyopadhyay tells RBI Governor Shaktikanta Das.
Budget was a mild disappointment. Yet, the bull run continues.
RBI may revise remuneration for banks.
There is so much liquidity in the system, in the global economy, and that's why the stock market is very buoyant. It will certainly witness correction in the future: RBI's Das.
Economists and investors want RBI to retain independence in setting rates
'Most importantly, marking a departure from the past, the RBI has made it clear that it is not overtly worried about the level of the local currency,' notes Tamal Bandyopadhyay.
'The slide in growth has arisen primarily because we have an NBFC crisis on top of a banking crisis,' points out T T Ram Mohan.
Rupee, bonds may see knee-jerk reaction, as Urjit Patel is considered an inflation warrior
Finance Commission has got new team who are committed to growth initiatives.
The message to bankers from Raghuram Rajan was clear.
'These are interesting days for watchers of English cricket and central banking,' points out Amol Agrawal.
The discussion paper is released at a time when the central bank is sifting through 26 applications seeking an entry into the fray.
For banks to cut loan rates, the cost of deposits needs to come down, and there is no sign of that happening.
The central bank can directly print money and finance the government, but it should avoid doing so unless there is absolutely no alternative, former RBI governor D Subbarao on Wednesday said while pointing out that India is 'nowhere' near such a scenario. In an interview with PTI, Subbarao suggested that to deal with the second wave of COVID-19 induced slowdown in the economy, the government can consider Covid bonds as an option to raise borrowing, not in addition to budgeted borrowing, but as a part of that.
Stressed MSME borrowers would be eligible for restructuring of debt, if their accounts were classified standard.
A 13-member group, headed by RBI Executive Director R Gandhi, has made various recommendations on G-Sec market, retail participation and interest rate derivatives market.
This Budget plans for an increase to 10.3% of GDP from 9.9%.
'We all wanted a strong Centre with a decisive mandate from the people, to allow them to take bold decisions.'
As the government plans to take sector-specific steps to tackle the slump, Finance minister Nirmala Sitharaman will soon hold talks with representatives from various sectors to get and take steps so that the confidence of those sectors can be restored.
An action on the rate front is unlikely to figure in Rajan's plan for the moment.
Economists have said if a stimulus is needed it should be different from what was provided in 2008-09, when the economy faced the ripple effects of a global meltdown following the Lehman Brothers collapse.
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Bankers remained ambivalent on the impact of Tuesday's policy announcement by Reserve Bank on the cost of funds and refrained from giving a guidance on the direction in which lending rates are headed.
Industrialists affirm their belief that the adverse effects of demonetisation and the goods and services tax are finally over.
Invest in liquid funds if you have a horizon of three months, ultra-short-term for six months, and low-duration funds for one year.
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