Raghuram Rajan speaks on the unscheduled rate cut.
Chaos in Parliament threw a spanner in the government's efforts to revive the economy and kick-start reforms.
High rates of such schemes deter banks from dropping borrowing rates - and thus lending rates
Heavy selling of the US dollar by banks and exporters in the face of renewed capital inflows predominantly kept sentiment highly buoyant
While Raghuram Rajan's departure under these circumstances is a pity, it would be wrong to conclude that the RBI or the economy cannot do without him.
The mismatch between industrialists' demand and account holders is because of inflation, Rajan said.
Since last month, the realty (down 23%), auto (down 16%) and finance (down 14%) indices have underperformed the market by falling over 13%, as against 8% decline in the benchmark indices
'Most importantly, marking a departure from the past, the RBI has made it clear that it is not overtly worried about the level of the local currency,' notes Tamal Bandyopadhyay.
Invest in liquid funds if you have a horizon of three months, ultra-short-term for six months, and low-duration funds for one year.
The message to bankers from Raghuram Rajan was clear.
If true then it would be a major disruption in the industry
After unseasonal rains, supply disruptions and pandemic-induced woes pushed retail inflation well over the Reserve Bank's comfort zone in 2020, the scenario is likely to stay that way at least in the short term as economic recovery slowly gains foothold. For most part of this year, pricier food items pushed the retail inflation, based on Consumer Price Index (CPI), higher in the range of 6.58-7.61 per cent, except for March when the reading was 5.91 per cent. Experts believe retail inflation is likely to average around 6.3 per cent this fiscal and mostly will remain sticky going forward owing to pick-up in demand across sectors.
Revising up inflation bands for the central bank will hurt the poor, former deputy governor of RBI Viral Acharya said on Wednesday, terming the current 4 per cent midpoint on price-rise as a "reasonable target".
Suggesting steps to boost the Indian economy, the IMF chief further said the government should focus on fiscal consolidation.
Rupee, bonds may see knee-jerk reaction, as Urjit Patel is considered an inflation warrior
For the week, the battered rupee gained 26 paise against the greenback
High frequency indicators suggest that a growth recovery is underway, but very tentatively and with weak legs, says Saugata Bhattacharya.
Given that there are hundreds of players in the shadow banking space, it's hard to make a credible estimate of potential NPAs. That creates more scope for panic, says Devangshu Datta.
An action on the rate front is unlikely to figure in Rajan's plan for the moment.
A 13-member group, headed by RBI Executive Director R Gandhi, has made various recommendations on G-Sec market, retail participation and interest rate derivatives market.
The 30-share Sensex jumped 729 points to end at 28,076 and the 50-share Nifty soared 217 points to end at 8,494.
Budget was a mild disappointment. Yet, the bull run continues.
RBI had received 72 applications for small finance bank licences.
The finance ministry has put out a revised draft in public domain.
Hardening prices of manufactured items during the month may refrain the Reserve Bank of India from cutting rates in its policy review on February 8.
The benchmark BSE Sensex reclaimed the 28,000 mark, spurting by 409 points or 1.4% at 28,114 and Nifty settled above the 8,500 mark at 8,532, gains of 111 points.
Private sector lender ICICI Bank has revised its external benchmark lending rate (EBLR) to 8.10 per cent, and state-owned Bank of Baroda has raised the rate to 6.90 per cent with immediate effect after the RBI hiked the key repo rate. Likewise, two other public sector banks -- Bank of India and Central Bank of India -- have also raised the repo linked lending rate. In an out of turn Monetary Committee Meeting (MPC), the Reserve Bank on Wednesday announced to hike the benchmark repo rate -- the short term lending rate it charges to banks -- by 0.40 per cent to 4.40 per cent with immediate effect, aimed at taming the rising inflation caused by the global geopolitical situation.
Experts have started giving comments on provisions that the govt must make in Budget 2016-17.
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.
The idea is to boost household savings and turn more of them into growth capital. If the plan succeeds, sustained eight per cent-plus rates of gross domestic product growth should be within reach in a few years.
The RBI governor most famous oneliners -- 'I am Raghuram Rajan and I do what I do' -- that eventually summed up the year 2015 for the central bank
The finance ministry on Friday informed a parliamentary committee that smuggling of fake currency has totally stopped post demonetisation and the tax department has seized Rs 515 crore in cash, including Rs 114 crore of new currency notes, up to January 10.
According to the final recommendations of an expert committee, the weight of primary (unprocessed) food items will go down by 0.5-1.0 percentage points in the new series compared to the current one
TCS, Bajaj Auto, Adani Ports and Cipla were the top gainers on BSE Sensex while Coal India, GAIL, Dr Reddy's and Infosys lost the most on the index.
Industry players said they were indeed seeing a serious fall in capacity usage, though some sectors were seeming to prevent further fall in the overall capacity utilisation.
A smartly executed reform-recap will be the best booster for the economy, says Ajay Chhibber.
The lack of an informal communication channel is what should bother the government and the RBI, if they want to eliminate the undesirable outcomes of the current tension between the two, says A K Bhattacharya.
Jaitley also hinted that these very economic realities could decide whether the government sticks to a fiscal consolidation roadmap or not.
'We have promised to ensure reduced tax rates.'
If banks cannot charge interest from borrowers during the moratorium, who will bear that cost? Should the depositors subsidise the borrowers by foregoing interest on deposits? In that case, we will turn banking on its head! notes Tamal Bandyopadhyay.
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