'Election years tend to see high government expenditure on unproductive schemes, though that money sloshing around can boost private consumption.' 'Again, it can mean higher inflation,' explains Devangshu Datta.
Financials ended mixed despite the status-quo on key rates by the RBI. SBI, ICICI Bank and Axis Bank ended up 0.4-2.5% each.
The message from the Reserve Bank of India is clear; interest rates are headed up.
The RBI expects CPI inflation to fall from 5.8% in Jan '16 to 4.8% in Jan-Mar '17.
In a move that may put pressure on housing and other consumer loans, Reserve Bank of India on Tuesday hiked its short term lending and borrowing rates by 0.25 per cent.
In a move that may put pressure on housing and other consumer loans, Reserve Bank of India on Tuesday hiked its short term lending and borrowing rates by 0.25 per cent.
Banks normally park almost 27 per cent of their funds in government securitie.
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The RBI said lead indicators point to continuing sluggishness in domestic economic activity in the first quarter of 2014-15.
SBI was the biggest loser in the Sensex pack, shedding 2.40 per cent, followed by Yes Bank, Bharti Airtel, L&T, Sun Pharma, M&M, ICICI Bank, ONGC, RIL, Asian Paints, Vedanta and HUL, which lost up to 2.37 per cent.
Inflation is expected to remain low in the near term, in part because of the further declines in energy prices.
Unless there is a sharp uptick in oil prices, Fed may push back rate hike
If this turns into reality, India's gross domestic product (GDP) growth will be the lowest since 2012-13, which could severely hit job creation and income growth in the near term.
The move, which could come as a surprise to many investors, was a nod to better prospects for economy and labor market
Sharp swings likely in equity, forex and bond markets.
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.
'Banks are being encouraged to lend instead of parking their resources with the RBI and earn risk-free interest income,' points out Tamal Bandyopadhyay.
The recent agreement between the RBI and the Centre marks a significant step forward toward financial inclusion.
RBI Governor Raghuram Rajan on Tuesday said the government will decide on extension of his tenure.
Mortgage lender HDFC Ltd on Wednesday announced an increase in its benchmark lending rate by 5 basis points (bps), a move that will make loans dearer for both existing and new borrowers. This is the third hike effected by HDFC in the last one month. "HDFC increases its Retail Prime Lending Rate (RPLR) on housing loans, on which its Adjustable Rate Home Loans (ARHL) are benchmarked, by 5 basis points, with effect from June 1, 2022," the housing finance company said in a statement.
For the first time in 21 years, the Reserve Bank of India (RBI) will revise norms for investment portfolios of commercial banks to reflect changes in global standards on valuation and measurement, and progress in the domestic market. This could pave the way for banks to transition to the new accounting standards (Ind-AS). The outstanding investment portfolio of commercial banks was at Rs 45.84 trillion as of November 19 this year.
Interview with former Reserve Bank of India governor by Duvvuri Subbarao.
The RBI governor-designate may be economical with spoken words, but is known for his sharp and critical writings
SBI is the first major bank to cut its base lending rate this year.
The friction with the political class is not only about interest rates and monetary policy. While the government often spoke freely about its discomfiture, the RBI had to be careful even in its response to the government as any loose statement would affect the markets.
It has been decided to reduce home loan rate by 20 basis points.
This is the second high profile resignation in the past six months at the Reserve Bank of India.
Pragmatism and flexibility is a virtue. An untethered and short-term approach to policymaking is a flaw, argues Mihir S Sharma.
Since January 1, the rupee value has fallen by 5.5 per cent against the US dollar and touched life-time low of 58.98 on Tuesday.
The dollar-rupee rate could move in the opposite direction if dollar policy rates rise and the FPIs sell in December, says Devangshu Datta.
In order to provide an impetus to digital funds movement, it has been decided to do away with the charges levied by the RBI for transactions processed in the RTGS and NEFT systems, RBI said.
For a long time, the Indian economy has been drifting without a credible monetary anchor.
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
CLSA says government actions to facilitate investment more important for revival than a token monetary easing.
Fed seen holding rates steady as investor confidence shakes
Since December 2018, monetary policy has been eased substantially by RBI with policy rates being cut by 75 bps and policy outlook being changed to 'accommodative'.
Bankers said high interest rate could make Indian economy sluggish given that inflation is around 5%
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.
The IMF expressed its opposition to any move that compromises the independence of central banks anywhere in the world.
The Nikkei India Services Purchasing Managers' Index, which tracks services sector companies on a monthly basis, stood at 52 in September, down from August's 43-month high of 54.7, pointing to a slower and moderate rate of expansion.
Economic growth projected at 8.5 per cent for 2007-08; Inflation to be close to 5 per cent.
