Battling a sharp surge in inflation, the Reserve Bank is all for a smooth monetary policy response and the desire to have smaller hikes led it to tighten the policy in an off-schedule meet, a source said on Thursday. Inflation has been massively impacted by Russia's invasion of Ukraine and will in due course also reflect the dent caused by Indonesia banning palm oil exports, the source aware of central bank thinking said, indicating that there was no other option but to respond. "The idea is to have a smooth policy response, not to put in large cold turkey responses," the source said, making it clear that the preference is for smaller magnitude responses and not larger ones.
'There will be no serious effect on Indian economy because one person, one man, however powerful, however influential, however great, cannot have an impact on an economy as big and complex as India.'
The Reserve Bank of India on Friday raised the benchmark lending rate by 50 basis points to 5.40 per cent to tame inflation.
RBI Governor Raghuram Rajan on Tuesday said the government will decide on extension of his tenure.
We need a change in mindset, says the RBI Governor.
Commemorating 75 years of India's independence, SBI has launched a 75-day Utsav Deposit Scheme, offering 6.10 per cent for fixed deposits. Senior citizens will get an additional 0.50 per cent and the offer is on until October 30, SBI said.
By no means do economists see the Reserve Bank of India stop at just a 25-bp cut. Some of the economists such as Soumyakanti Ghosh of State Bank of India are of the firm view that rates have room to fall by a total of 75 bps in the current financial year, starting with 25 bps in the August 7 policy.
Encouraged by softening inflation, the RBI on Thursday decided to cut the benchmark interest rate by 0.25 per cent to 7.75 per cent with a view to boost growth.
The Reserve Bank of India (RBI) on Friday decided to leave the benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance, implying rate cuts in the future if need arises to support the economy hit by the Covid-19 pandemic.
RBI Governor Shaktikanta Das on Friday said that inflation is on a declining trajectory, as it has fallen by 170 basis points from its January 2020 peak. Retail inflation fell to four-month low of 5.91 per cent in March over the previous month, mainly due to easing food prices.
Total debt for listed Indian companies excluding financials fell only 4 per cent to $368 billion in the year ended in March 2015.
India's economy is not like Western ones, and thus needs restrained fiscal policy even during a recession, says Ajay Shah.
We asked colleagues, present and past, to reflect on a man who has made such a difference to their lives and careers. Here it is then, a rich collection of memories that offer enchanting glimpses of the enigmatic Ajit Balakrishnan.
'If the RBI now only prints Rs 100 in small denomination notes and the remaining amount is printed in Rs 500 and Rs 2,000 denominations, then by March-end the central bank can completely normalise the cash crunch situation.'
Forex market was closed on Thursday on account of Ganesh Chaturthi.
The fragmentation of politics and the pressures of coalition management have contributed to a near-secular rise in budgetary social expenditures and spending on subsidies since 1991, leaving little fiscal space for government-led capital investment.
Many analysts over the past week have said the RBI has legroom to cut rates to the tune of 65 bps by June and some like Barclays and BofA have also spoken about the likelihood of an inter-meeting cut.
Will Arundhati Bhattacharya be the RBI's first woman governor? Or will Urjit Patel succeed Raghuram Rajanas RBI governor when his term ends on September 4?
SBI is the first major bank to cut its base lending rate this year.
On the sectoral front, rate-sensitive sectors such as Bankex and Auto gained by 1% and 0.7% respectively while BSE Consumer Durables gained 1.4%.
In cutting interest rates and giving a boost to the government's efforts to revive growth, RBI governor Raghuram Rajan displayed the pragmatism and flexibility familiar to those who work with him.
'There are deeper, underlying, forces at work and we need institutional arrangements to guard against them.'
Instead of only focusing on the tenure for which the best interest rate is available, investors should also focus on their own investment horizon.
The dollar was firm against some global currencies which also weighed on the rupee.
Inflation in food articles basket was 6.99 per cent In May, 2019, down from 7.37 per cent in April. However, onion prices spiked in May with inflation at 15.89 per cent, as against (-) 3.43 per cent in April.
Domestic fund houses are of the view that the US Fed's status quo stance on rates is a positive indication for RBI to lower its lending rates.
Wednesday's was the first MPC meeting that had a dissent note.
India Inc on Friday said it is looking forward to a repo rate cut in future as cost of funds has to come down in coming times, and expects continuation of accommodative policy stance by the Reserve Bank of India (RBI). The RBI decided to leave the benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance, as the economy faces the brunt of the second COVID-19 wave. Sanjay Aggarwal, president of PHD Chamber of Commerce and Industry, said the RBI has maintained an accommodative stance as long as necessary to revive and sustain growth on a durable basis and to mitigate impact of COVID-19, apart from an aim to keep inflation within the target.
On the reduction in the SLR ratio, he said it was a signal from the point of view of long-term reforms.
Reserve Bank on Tuesday raised key interest rates by 25 basis points, its 13th such hike since March, 2010.
Nudging the RBI to cut interest rates to boost growth, Finance Minister Arun Jaitley on Sunday said he had already made his mind clear and hoped the central bank will take decision after taking into account various factors.
Inflation moderates, but a rate cut is unlikely.
Two members recommended bringing down the rate by 50 bps in the April policy.
Given the various risks to growth, one could argue for rate cuts to be deeper than the 5 per cent terminal repo rate that we are projecting at this stage, says Kaushik Das.
India's economy will do well once vaccination reaches a critical mass as pent up demand, global recovery and easy financial conditions will boost activities, RBI's Monetary Policy Committee (MPC) member Ashima Goyal said on Tuesday.
India showed revival signs in the March quarter.
In the Sensex pack, Sun Pharma was the biggest gainer, rallying 4.48 per cent, followed by Bajaj Auto, Tata Motors, Coal India, Hero MotoCorp, Maruti and HCL Tech, rising up to 3.01 per cent. While, RIL, PowerGrid, HDFC, L&T, IndusInd Bank, NTPC and Bajaj Finance declined up to 1.50 per cent.
After his decision to return back to academia, there have been voices suggesting that his candid public speeches were one of the aspects which made the government uncomfortable about reappointing Rajan for another term
In a setback to former deputy chief minister Manish Sisodia, the Supreme Court on Monday denied him bail in the corruption and money laundering cases related to the alleged Delhi excise policy scam, saying the accusation of "windfall gains" of Rs 338 crore to wholesale liquor dealers was "tentatively supported" by evidence.
