RBI said the outlook for economic growth for 2016-17 has turned uncertain after the unexpected loss of momentum by 50 basis points in Q2 and the effects of the withdrawal of banned notes
RBI Governor Raghuram Rajan on Tuesday kept the repo rate unchanged 6.50 per cent.
Retail inflation fell to a five-month low of 4.35 per cent in September from 7.27 per cent in the year-ago period as prices of vegetables and other items declined, according to government data released on Tuesday. The moderation in Consumer Price Index-based inflation is in line with the assessment of Reserve Bank Governor Shaktikanta Das who recently projected substantial softening of retail inflation. The CPI inflation was at 5.3 per cent in August and at 7.27 per cent in September 2020.
Interview with former Reserve Bank of India governor by Duvvuri Subbarao.
The rising COVID-19 infections across the country are a matter of concern, but it may not impact the ongoing economic revival as one does not foresee lockdowns, Reserve Bank Governor Shaktikanta Das said on Thursday. The economic revival will continue "unabated", Das said, asserting that there is no need for a downward revision of RBI's 10.5 per cent GDP growth forecast for FY22. Speaking at Times Network's India Economic Conclave, Das said, "We have 'insurance' to protect economic revival like a fast-paced vaccination drive, greater ability among people to follow COVID protocols", and one does not see lockdowns as well.
India decisively withstood global headwinds in 2023 and is likely to remain as the world's fastest-growing major economy on the back of growing demand, moderate inflation, stable interest rate regime and robust foreign exchange reserves. Despite widespread pessimism witnessed among the developed nations and the worsening geopolitical situation, India recorded a gross domestic product (GDP) expansion of 6.1 per cent in the March quarter. The growth moved up to 7.8 per cent in the June quarter and was 7.6 per cent in the September quarter. For the first six months of this fiscal, the growth was 7.7 per cent.
'To the believers of crypto regulations, I have only one question to ask, how will you regulate it?'
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.
It's crucial for Modi to make India an easier place to do business.
Among the Sensex firms, Bajaj Finance emerged as the biggest gainer by climbing 2.95 per cent. Tata Motors, Bajaj Finserv, IndusInd Bank, Sun Pharma, Mahindra & Mahindra, State Bank of India, Larsen & Toubro, HDFC, HDFC Bank, Maruti, Reliance Industries and Bharti Airtel were the other major winners. HCL Technologies, Axis Bank, ICICI Bank, Tech Mahindra and Titan were among the laggards.
Kaushik Basu, whose stint at the World Bank ends on July 31, was being looked at as a serious contender, the sources said
Goyal said India has been recognised as brightest spot in the world in last five years.
RBI targets to keep inflation at 4 per cent, (+/- 2 per cent), and its rise beyond this comfort zone will put pressure on the central bank to hike rates.
The International Monetary Fund (IMF) on Tuesday slashed India's growth forecast for 2022-23 (FY23) by 80 basis points to 7.4 per cent, citing less favourable external conditions and rapid policy tightening by the central bank. In its update to the April World Economic Outlook, the IMF said that though a global recession in 2022 was ruled out with a growth estimate of 3.2 per cent, the balance of risks was squarely to the downside, driven by a wide range of factors that could adversely affect the global economic performance. "The risk of recession is particularly prominent in 2023, when in several economies growth is expected to bottom out, household savings accumulated during the pandemic will have declined, and even small shocks could cause economies to stall.
Rajan had overturned the majority opinion of the members and chose to hold the rates at the last monetary policy review in October.
Higher for longer' may be the narrative in the developed markets, but interest rates might not stay high for very long in India, with a section of the market expecting rate cuts to begin this year. The six-member Monetary Policy Committee of Reserve Bank of India (RBI) decided to keep interest rates unchanged at 6.5 per cent in the April review - after hiking the policy repo rate in six previous meetings. RBI Governor Shaktikanta Das emphasised that the pause was only for the April policy and that the central bank was ready to act if the situation demanded.
Central bank moves to infuse liquidity into bond market to help boost sentiment.
With Raghuram Rajan not 'really there', the FinMin has decided to keep a watch on market developments this week with all key officials on the job.
As he projected a grim outlook for the economy, RBI Governor said that amidst this encircling gloom, agriculture and allied activities have provided a beacon of hope on the back of an increase of 3.7 per cent in foodgrains production to a new record.
Reserve Bank Governor Raghuram Rajan on Thursday said the central bank will continue its focus on taming inflation, speeding up resolution of distressed projects and ensuring enough capital for banks through balance sheet clean-up.
The Sensex jumped 412.23 points on Friday, braving heavy volatility during the day, amid the Reserve Bank of India maintaining status quo on the benchmark lending rate and buying in index heavyweights Reliance Industries Limited and ITC. The BSE Sensex climbed 412.23 points or 0.70 per cent to settle at 59,447.18. During the day, the benchmark hit a high of 59,654.44 and a low 58,876.36. The Nifty also gained 144.80 points or 0.82 per cent to finish at 17,784.35.
A day after the Reserve Bank of India's (RBI's) Monetary Policy Committee hiked the policy repo rate by 50 basis points (bps), several commercial banks, including ICICI Bank and Bank of Baroda, raised their external benchmark-linked loan rates by an equal amount on Thursday. HDFC, the country's largest mortgage lender, too, increased its interest rates on housing loans by another 50 bps. In total, it has raised rates by 85 bps since May 4, when the RBI had increased the repo rate by 40 bps in an off-cycle meeting.
The speed at which he led the central bank in different areas -- ranging from internal reorganisation to inflation fighting, stabilising the currency, taking on rogue corporations, cleaning up bank balance sheets, and opening the sector -- makes one believe that Rajan knew he had only three years to do his job. A fascinating excerpt from Tamal Bandyopadhyay's MUST-READ Roller Coaster: An Affair with Banking.
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
Here are the key decisions announced by the Reserve Bank of India on Thursday.
The increase reflects a quarter-on-quarter increase of 2.6 per cent in October-December 2022-23. In absolute terms, the total liabilities, including liabilities under the 'Public Account' of the government, jumped to Rs 1,50,95,970.8 crore at the end of December 2022.
RBI is expected to discuss about the impact of GST in its monetary policy.
'If rate cuts happen, bond yields will come down and investors will make mark-to-market capital gains on them.'
It would be a good idea to create independent oversight committees for each regulatory institution and indeed, even for their appellate bodies, says A K Bhattacharya.
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?
The downward surprise in Q2 stemmed from a stronger-than-anticipated drag from gross fixed capital formation and marginal weakness in private final consumption expenditure. In Q3, projection errors emanated mainly from a steep unanticipated contraction in gross fixed capital formation, which was the deepest in the new series of GDP.
Investors saw their wealth rise by more than Rs 3.96 lakh crore on Wednesday as stocks continued their rally for the second straight session amid the Reserve Bank reiterating its accommodative stance and easing concerns over the Omicron variant of the coronavirus. The 30-share Sensex soared 1,016.03 points or 1.76 per cent to close at 58,649.68 and all the constituent stocks, except for two, closed in the green. Most of the rate-sensitive auto, banking and realty stocks registered gains during the day's trade. While the BSE Auto index rose 2.24 per cent, BSE Bankex went up 1.61 per cent and BSE Realty spurted 1.72 per cent.
'We have delivered a bitter medicine. It will take time to work.'
The Indian economy appears to have slowed down in 2018-19 due to lower private consumption, tepid growth in fixed investment and muted exports, a finance ministry report has said.
HDFC Bank was the top loser in the Sensex pack, shedding over 3.5 per cent, followed by Bajaj Finance, L&T, HDFC, Bajaj Finserv, HDFC and Kotak Bank.
Bond markets, global as well as domestic, are likely headed towards hard times over the next three to six months, as higher vegetable prices, rising fuel costs, and improved wages may keep inflation hot, believe analysts, who expect the yields to hit 7.5 per cent in the near-term from the current 7.234 per cent. In this backdrop, they suggest investors can put in money in funds/instruments with residual maturity of 4 to 6 years, while longer-term investors can allocate cautiously to the longer end in the range beyond 7 years.
Despite admitting to price pressures both from food items and input prices, RBI Governor Shaktikanta Das on Wednesday hoped that a normal Southwest monsoon will have a "soothing impact" on inflation pressures and ruled out any wide variations in medium-term inflation forecast from what was given in April. In an unscheduled address earlier in the day amidst the raging pandemic, Das said the overall outlook for the economy is highly uncertain and is clouded with downside risks. He offered a slew of relief and liquidity measures to individuals and small businesses apart from a Rs 50,000 crore special liquidity window to the healthcare sector.
Taking advantage of the RBI's different accounting year, the Centre had started demanding an interim dividend till the time the latter's final balance sheet is prepared (usually in August). To address this anomaly, an expert committee led by former RBI governor Bimal Jalan had recommended aligning the RBI's financial year with that of the government.
Seeking to dispel possible notions of the RBI not having done enough by opting for a pause for the second consecutive time, Das said the RBI has a wide dashboard of instruments beyond rates that can be deployed.
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.
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