Banks argued that loans of most lenders are funded primarily by retail deposits and not from the wholesale market as was the practice abroad
The government has no plan to print currency notes to tide over the current economic crisis triggered by the outbreak of COVID-19 pandemic, Finance Minister Nirmala Sitharaman informed Parliament on Monday. To a question on whether there is any plan to print currency to tide over the crisis, the finance minister said, "No Sir". Many economists and experts have suggested to the government to print more currency notes to tide over the difficult economic situation with a view to support the economy ravaged by the spread of COVID-19, and protect jobs.
The reform priorities are clear: enhance savings, improve productivity. Just 25 basis points of moving interest rate up or down would not boost investment: Former RBI Governor Y V Reddy.
India's services sector activity moderated further in January as new business rose at a noticeably slower rate amid the escalation of the pandemic, reintroduction of restrictions and inflationary pressures, a monthly survey said on Thursday. The seasonally adjusted India Services Business Activity Index fell to 51.5 in January, down from 55.5 in December, pointing to the slowest rate of expansion in the current six-month sequence of growth. For the sixth straight month, the services sector witnessed an expansion in output.
Costlier vegetables slowly pushed retail inflation, which had remained well within the Reserve Bank's comfortable level of 4 per cent during most part of 2019, peaked to more than three-year high of 5.54 per cent in November.
Costlier vegetables and eggs pushed up retail inflation to a nearly six-and-a-half year high of 7.61 per cent in October, keeping it significantly above the comfort zone of the Reserve Bank.
During the month, inflation in vegetables shot up to 35.99 per cent, as against 26.10 per cent in October. Likewise, the prices of cereals and eggs grew at a faster pace of 3.71 per cent.
Potato, a daily consumable vegetable, witnessed maximum inflationary pressure at 60.58 per cent
A fall in the rupee could boost exports. But the flip side of the equation is that a weaker rupee could stoke some inflation
A V Rajwade wonders if the Modi sarkar is pursuing price stability at the cost of potential social instability in both rural and urban India.
Reserve Bank of India Governor Shaktikanta Das tells Anup Roy, Raghu Mohan and Niraj Bhatt that it is time for banks to lower interest rates and start lending to cash-starved finance companies after due credit appraisal and proper risk assessment.
'There are deeper, underlying, forces at work and we need institutional arrangements to guard against them.'
Managing Brexit, inflation and banking reforms, along with the political environment, will be tough.
The headline seasonally adjusted Nikkei India Composite PMI Output Index, that maps both the manufacturing and services sectors, rose from 53.3 in June to 54.1 in July.
It would be beneficial for the economy to hold on to high interest rates till inflation numbers are under control.
Some say the MPC will raise the rate, while others are of the view that there is already de facto interest rate tightening through rising bond yields, which might prompt the central bank to go for a pause.
Barry Eichengreen, professor of economics and political science, University of California, Berkeley, analyzes the transparency of the Reserve Bank of India, the growth rate of the Indian economy and why he feels globalisation can never be rolled back.
Currency scarcity weighed on manufacturing performance where growth of new work flows slowed
The Reserve Bank of India is expected to announce a slew of measures to bring vibrancy into the debt market as part of its mid-term review of the annual monetary policy.
The size of the hole in today's banking crisis appears to be roughly 10 per cent of GDP.
The wider Nifty hit a low of 10,033.35 before finishing at 10,044.10, down 74.15 points or 0.73 per cent.
'If Urjit Patel had resigned after the five-state elections results people would have taken a different view. So this was the right time for him to resign.' 'He rightly resigned as he felt the differences with the government were not getting settled.'
The Financial Stability and Development Council meeting on Tuesday started with an air of tension in the room. An official present described the participants' body language as "tetchy". However, once presentations and discussions begun, the mood considerably eased.
Rajan said the process of dialogue with the government did not reach a stage where he could have agreed to stay on
RBI could opt for a 'deep cut' after winning inflation war, say experts.
The Reserve Bank of India has set up an experts committee to implement Basel II accord by 2006 to strengthen the financial health of banks by adopting globally accepted norms for capital adequacy.
he reason behind the cut in policy rate seems to be a slowing economy
Says impact of crisis in China won't be as big here as in some other countries
The wait for India to become a $5-trillion economic powerhouse by 2024-25 (FY25) is going to take longer than what the finance ministry had originally intended, according to the International Monetary Fund (IMF). The vision will instead be achieved in 2028-29 (FY29), reveals the IMF data, illustrating a four-year delay. Chief Economic Advisor (CEA) V Anantha Nageswaran had in February said India would become a $5-trillion economy by 2025-26 or the following year, on the back of 8-9 per cent sustained growth rate in real gross domestic product (GDP). However, the IMF data conveys that the economy will be $4.92 trillion in FY28, clearly alluding to the fact that the target will be realised in FY29.
There is also a lobby within the bureaucracy that wants to see Rajan's influence curtailed
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'.
Arun Jaitley had proposed to set up a Public Debt and Management Agency.
RBI Governor Raghuram Rajan is regarded as credible by global financiers.
A host of factors including the reform measures taken by the government and decline in global oil and commodity prices have led to lower inflation, the Finance Ministry said on Wednesday.
He has had a productive first year at the RBI -- one which saw, also, India's economic imbalances improve and the unexpectedly strong general election outcome.
Bajaj Finance was the biggest loser in the Sensex pack, tanking up to 8 per cent, followed by Hero MotoCorp, IndusInd Bank, Maruti and HCL Tech. Axis Bank, ITC, NTPC and M&M were among the top gainers.
Finance Minister Arun Jaitley said RBI and the government are in continuous dialogue and that relationship will continue.
Rajan drew attention towards the Nachiket Mor committee on PSL and said that the RBI is trying to make the entire process more effective.
'The Reserve Bank's independence has remained a work in progress, an enduring challenge that the nation has been grappling with on an ongoing basis,' says RBI Deputy Governor Dr Viral Acharya.
The year 2014-15 could well go as one of long-pending financial sector reforms, expected to have a lasting impact.
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