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Industry's demand for a reduction in the repo rate, currently 8 per cent, has gained momentum after wholesale and retail inflation eased in February.
Bajaj Finance was the top gainer in the Sensex pack, rising around 4 per cent, followed by Maruti, SBI, Bajaj Finserv, Sun Pharma and Asian Paints. NSE Nifty rallied 293.05 points to 17,469.75.
The Central Bureau of Investigation has arrested former ICICI Bank CEO and MD Chanda Kochhar and her husband Deepak Kochhar in connection with alleged cheating and irregularities in loans sanctioned by the bank to the group in 2012, officials said on Friday. The CBI had booked Chanda Kochhar, her husband and Venugopal Dhoot of Videocon Group, along with companies Nupower Renewables, Supreme Energy, Videocon International Electronics Ltd and Videocon Industries Limited, as accused in the FIR registered under IPC sections related to criminal conspiracy and provisions of the Prevention of Corruption Act, they said.
Focus on inflation, higher CPI projection dampen bond market mood.
A selection committee, headed by Reserve Bank of India (RBI) Governor D Subbarao, is scheduled to meet next week to shortlist candidates for the post of the deputy governor of the central bank.
An initial reading of the guidelines indicates two factors - potential rise in borrowing cost and lower returns on investment book - could hit the spread of NBFCs.
'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.'
Currently, banks are closed every second and fourth Saturday of a month. Why shouldn't they be shut every Saturday? When most customers carry their banks in their pocket (the app on the mobile phone), there is no need to keep banks open on Saturdays, argues Tamal Bandyopadhyay.
The Reserve Bank on Monday pitched for creation of a conducive environment for investment and faster clearances of projects to boost economic growth which slowed to a decade low of 5 per cent in the previous fiscal.
Most central banks across the world have around 5-7 years of tenure for the governor and deputy governors.
Banks argued that loans of most lenders are funded primarily by retail deposits and not from the wholesale market as was the practice abroad
'There is no difference between the earlier government and the present government.' 'They are all following the economic policy based on the Chicago School of thought.' 'This school of thought says the government should have very little role in governing the country and the majority of the work should be handed over to the private sector.' 'This has not succeeded in the US.' 'Yet, it is being tried here by people like Arvind Subramaniam, Arvind Panagariya, Urjit Patel and Raghuram Rajan.'
The Reserve Bank will take some action by this month end after consultations with the Indian Banks' Association.\n
...why are the government is running away from a Joint Parliamentary Committee
India's manufacturing sector activity hit the highest level in eight months in July, driven by a significant rise in business orders, a monthly survey said on Monday. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index rose from 53.9 in June to 56.4 in July, reflecting the strongest improvement in the health of the sector in eight months. The July PMI data pointed to an improvement in overall operating conditions for the 13th straight month.
The finance minister chided the central bank on Tuesday over its focus on fighting inflation, saying the Reserve Bank of India (RBI) also needed to abide by the government policy to promote economic growth.
'The actions of Indian monetary authorities will depend on how quickly they want the inflation to come down to 4 per cent.'
Meanwhile, RBI Governor Raghuram Rajan said at the meeting that the central bank brass discussed strengthening the state- level coordination committees so that unauthorised deposit taking can be dealt with in a better way.
The Reserve Bank of India (RBI) plans to impose stricter limits on how much a bank can lend to a single corporate group, a move aimed at curbing risk in the banking sector at a time when bad loans are on the rise.
The committee is considering multiple BPLRs for corporates, SMEs and retail borrowers and is likely to meet by mid-September to finalise the recommendations on the BPLR structure. BPLR is the interest rate that commercial banks charge their most credit-worthy customers.
It further pointed out that the twin balance sheet problem -- at the end of banks and corporate -- more attractive interest rates for borrowers in the bond market and from non-banking financial institutions are other reasons for slow bank credit growth.
To contain rising bad loans, the Reserve Bank on Tuesday proposed a slew of measures, including incentives to lenders for coming together and tackling an account timely and penalising borrowers with higher interest rates in future for not cooperating for a resolution.
As inflation rate is near the upper limit of the comfort zone, experts rule out rate cuts anytime soon
The report, however, said it remains watchful of the upside risks to inflation emanating from pass-through of minimum support prices (MSPs), adverse movement in crude oil prices, volatility in global financial markets, lagged impact of the rupee weakness on input prices, adverse implications from fiscal slippage and staggered impact of HRA increases by states and its second-round impact.
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.
The government should not go in for an 'aggressive fiscal consolidation' in the upcoming Budget as global risks have not abated, RBI Monetary Policy Committee (MPC) Member Ashima Goyal said on Wednesday. Goyal further said subsidies are expected to come down as food and energy inflation moderates. WPI inflation in food articles in November was 1.07 per cent against 8.33 per cent in the previous month.
Issuance of new bank licences proves that the apex bank wants the financial sector to flourish.
Will help to reduce imports of the metal.
Banks normally park almost 27 per cent of their funds in government securitie.
It is the six per cent target RBI is more concerned about.
India's services sector lost momentum in July as demand was curtailed by competitive pressures, elevated inflation and unfavourable weather, a monthly survey said on Wednesday. The seasonally adjusted S&P Global India Services PMI Business Activity Index fell from 59.2 in June to 55.5 in July, pointing to the slowest rate of growth in four months. For the 12th straight month, the services sector witnessed an expansion in output. In Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion while a score below 50 denotes contraction.
Whether this remains under control in the coming months will depend on the future intensity and spread of the Russia-Ukraine war, and the effectiveness of the Indian government's response, points out A K Bhattacharya.
The Reserve Bank of India is likely to cut policy rates by 0.25 per cent and keep the cash reserve ratio unchanged at its policy review next week, on the back of slower-than-expected growth and more encouraging inflation readings, says a report by HSBC.
Dr Raghuram Rajan's departure holds lessons for all, be it sections of the media, politicians or the people themselves. We need to learn how to value and retain talent. At the same time the talented must realise that talent alone does not ensure the top job, says Sanjeev Nayyar.
It would be beneficial for the economy to hold on to high interest rates till inflation numbers are under control.
The government plans to bring down its stake to 26 per cent in these two banks, which are yet to be identified. This may not come in the way of getting investors for these banks, provided the government is willing to step back rather than run them the way it had been doing for over five decades since these banks were nationalised, points out Tamal Bandyopadhyay.
Delivering the key mote address at the Citi's Investor Summit, Jaitley hoped that as a professional organisation the Reserve Bank will take 'the best decision'.
In an attempt to mitigate the problems faced by the beleaguered diamond industry in Gujarat, the Reserve Bank of India has decided to set up a task force comprising representatives of the state government, the State Level Banking Committee Convener and other bankers.The task force will submit its report by the month-end. Gujarat's diamond industry has been beset with problems, chief among them being lacklustre Christmas-season demand for finished diamonds.
Inflation in the 'fuel and power' basket in December slumped to 8.38 per cent, nearly half of 16.28 per cent.
Shifting its stance of monetary policy towards targeting retail inflation as it is an "inequitable tax", RBI today said it may exceed 8 per cent by March end and efforts will continue to bring it down.
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