Priorities include the amendments of the Companies Act and the Motor Vehicle Act
The recent agreement between the RBI and the Centre marks a significant step forward toward financial inclusion.
Thanks to Rajan we are an inflation-targeting country now
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Bank has cited trend of global easing and weak growth
'Even if there is a third wave or a fourth wave, it is hard to see the economy will suffer like that (during the first wave).'
Policy rates have been reduced substantially in 2015.
Taking on board India's concerns, the G-20 Summit on Friday acknowledged that excess volatility of financial flows and disorderly movements in exchange rates can affect economic and financial stability of emerging markets and called for sound policies to address it.
The Reserve Bank on Thursday said it will come out with a framework allowing borrowers to switch to fixed interest rate from floating interest rate, a move that would provide relief to borrowers of home, auto and other loans reeling under the impact of high interest rate. Unveiling the bi-monthly monetary policy, Reserve Bank Governor Shaktikanta Das said under the framework, to be put in place shortly, the lenders will have to clearly communicate with the borrowers about tenor and EMI. "The supervisory reviews undertaken by the Reserve Bank and the feedback and references from members of public have revealed several instances of unreasonable elongation of tenor of floating rate loans by lenders without proper consent and communication to the borrowers," he said.
In the current fiscal so far, retail inflation stabilised around 5 per cent, while wholesale price-based inflation averaged around 2.9 per cent during April-December.
The first major aspect is that of the veto power to the governor.
The Reserve Bank on Friday projected retail inflation to be in 5-5.2 per cent range during the first half of the next fiscal year, expecting further softening of vegetables prices in near term. Also, it has lowered the retail inflation forecast for the current January-March quarter of 2020-21 fiscal at 5.2 per cent. The Reserve Bank (RBI) has kept the key policy rate unchanged at 4 per cent, with an accommodative stance, so as to ensure that inflation remains well within the target, Governor Shaktikanta Das said while announcing the last monetary policy of 2020-21.
Reserve Bank Governor Shaktikanta Das on Monday said despite the latest headwinds arising from the Jackson Hole summit leading to extreme volatility, our banking system and financial markets are strong enough to withstand such pressures. Taking the markets by surprise, US Fed chair Jerome Powell had told the annual Jackson Hole summit of central bankers and economists last week that he would have to keep raising federal fund rates to tame inflation, which remains the biggest challenge to the world's largest economy. He also warned of the pains that such monetary policy actions would create on growth and jobs.
RBI is expected to discuss about the impact of GST in its monetary policy.
Three years after India declared its goal to become a net-zero economy by 2070, the policy design for achieving the target has begun, with the NITI Aayog forming dedicated multi-sectoral committees to prepare a transition plan. In 2021, India joined a select group of nations that set a target year for becoming net-zero carbon economy. At COP26 in Glasgow, Prime Minister Narendra Modi outlined a five-pronged 'Panchamitra' climate action target for India and committed to a net-zero target by 2070, joining nations like the US, the UK, and China.
Inflation in food articles during June stood at 2.04 per cent, as against 1.13 per cent in May.
The cost of holding one-year forward dollars rose to 482.75 basis points from 472.75 bps on Tuesday.
There is evidence of asymmetric adjustment to monetary policy
Observing that there is liquidity overhand of Rs 13 lakh crore in the system, RBI Governor Shaktikanta Das said on Friday that the exceptional measures undertaken during pandemic will be dealt in sync with macroeconomic developments to preserve financial stability. Since the onset of the pandemic, the Reserve Bank has maintained ample surplus liquidity to support a speedy and durable economic recovery, he said while announcing the outcome of the Monetary Policy Committee (MPC) meeting. The level of surplus liquidity in the banking system increased further during September 2021, with absorption under fixed rate reverse repo, variable rate reverse repo (VRRR) of 14 days and fine-tuning operations under the liquidity adjustment facility (LAF) averaging Rs 9 lakh crore per day as against Rs 7 lakh crore during June to August 2021, he said.
On the present government's 'Make in India' campaign, C Rangarajan, former chairman of the Prime Minister's Economic Advisory Council, says it is important to first ask for whom it is being made.
Subramanian, a senior fellow at the Peterson Institute for International Economics in Washington, attended a news conference in New Delhi at which his appointment was announced.
RBI could opt for a 'deep cut' after winning inflation war, say experts.
Inflation targeting framework is now enshrined as a formal agreement by the government and the RBI; thus, it may seem that we are flogging a dead horse, says Soumya Kanti Ghosh.
M V Subramanian says there is an imperative need for collective responsibility to tackle inflation, prices and availability of essential commodities, and not rely on inflation targeting alone.
The Reserve Bank on Friday took steps towards normalisation of liquidity management to pre-pandemic levels, with the introduction of the standing deposit facility (SDF) as the basic tool to absorb excess liquidity, and narrowing the liquidity adjustment facility (LAF) to 0.50 per cent from the 0.90 per cent. Governor Shaktikanta Das said the SDF will be at 3.75 per cent, 0.25 per cent below the repo rate and 0.50 per cent lower than the marginal standing facility (MSF) which helps the banks with funds when required. The SDF has its origins in a 2018 amendment to the RBI Act and is an additional tool for absorbing liquidity without any collateral.
There was no word on whether or when Patel would be talking to the media about his priorities and plan of action as head of Mint Street
The RBI was not party to the decision to demonetize 500 and 1,000-rupee notes, which was taken at the highest level of India's political leadership.
Reserve Bank Governor Shaktikanta Das on Wednesday said underlying economic activity in India continues to be strong, but external factors will cause some "dent" to the economy. Speaking at the BFSI Insight Summit 2022 organised by Business Standard, Das said the RBI tracks 70 fast moving indicators and most of them are in the "green box". It is the external sector, mired by a fear of recession or clear visibility about slowing growth in a large part of the world, where the challenges lie, he said, adding that the impact of external demand will "dent" the economy.
A lot depends upon the composition of the monetary policy committee.
A day after the Reserve Bank of India's monetary policy review, the RBI Governor talked to journalists on related issues.
For India, Fitch Ratings has 'BBB-' rating.
The Reserve Bank of India on Friday decided to leave benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance as the economy faces heat of the second Covid wave.
It's unfair to over-emphasise Urjit Patel's shy and reticent image.
A comprehensive technical framework needed, from which a more convincing policy could be demonstrated
Amendments to RBI Act likely soon
Rajan also said it's a problem of collective action and not a problem of industrial nations or emerging markets
Following are comments from economists at leading financial institutions, banks and rating agencies on the interim Budget:
'If there is a push towards a Marxist oriented government it will be dangerous.' 'We have seen this in Nepal and Myanmar and it will be a concern for India if it is surrounded by countries with such political dispensations.'
With the next review of the flexible inflation target (FIT) framework coming up soon, the Reserve Bank of India (RBI) on Friday said the current inflation target of 4 per cent with a +/-2 per cent tolerance band is appropriate for the next five years. The country adopted the FIT framework in 2016, and the next review of the inflation target is due before March 31, 2021. "The current numerical framework for defining price stability, i.e., an inflation target of 4 per cent with a +/-2 per cent tolerance band, is appropriate for the next five years," the RBI said in the Report on Currency and Finance (RCF) for the year 2020-21.
RBI Governor Raghuram Rajan on Tuesday kept the repo rate unchanged 6.50 per cent.
For all its claims to economic glory, the majority of India's population lives vulnerable lives, a situation that has only worsened over the past 15 years, to the extent that the government now fears to release economic data or even conduct a proper Census, notes Rathin Roy.
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