While making it clear he will continue with the strategy followed by RBI so far on inflation and exchange rate management, RBI Governor D Subbarao said, "We will be monitoring the situation closely and continuously, be mindful of implications of our monetary stance on the growth prospects and take action as appropriate." He added, "I am not sure whether we can say inflation is softening consistently, but the decline in the Wholesale Price Index is satisfying."
The Reserve Bank may give up its opposition to the proposal of a monthly compilation and release of inflation data, with D Subbarao moving to the central bank from the finance ministry, which was open to the idea of a shift in the time table of the Wholesale Price Index.
Warning that the worst may not be over yet, Reserve Bank Governor D Subbarao has said the global economic recession may not only continue through 2009 but could prolong to the next year as well.
Our economic climate since the spring of 2007, when foodgrain prices started their journey northwards, has created an imbalance in market power between buyers and sellers, to the great disadvantage of the former.
Reserve bank of India governor Duvvuri Subbarao has said that India is not contemplating imposing Tobin Tax on capital inflows, but did not rule out introducing it later.
Continuing the upward march, inflation crossed 11 per cent in March in the final data, while this was only 9.9 in provisionally.
The Reserve Bank on Monday warned that India's foreign exchange reserves mostly comprise borrowed funds and the country is vulnerable to sudden outflow of funds.
The Reserve Bank on Friday said the agriculture growth will be muted this fiscal on account of the impact of poor monsoon on kharif crops.
The central bank has clearly signalled the conditions under which monetary easing would take place early this quarter. And, current conditions meets the RBI's paramters
Broader markets ended weak with mid-caps falling 0.4 per cent while small-caps declined 1.3 per cent on the BSE.
The word 'balancing' seems to be a favourite of Reserve Bank of India Governor D Subbarao.
Monsoon is this year expected to bring 19 per cent less rainfall than usual, resulting in an equivalent decline in sowing activities.
The Reserve Bank of India has launched an assault on inflation by increasing the cash reserve ratio (CRR) 75 basis points to 5.75 per cent. While sounding upbeat on economic growth, the central bank has kept the door open for an increase in interest rates even before the annual policy statement in April.
These bank notes will bear the symbol on the observe and the reverse with inset letter E.
The Reserve Bank on Thursday said it is considering the possibility of allowing Islamic financial institutions to function as NBFCs since Islamic banks are not permitted under the present laws.
RBI is also considering a proposal to re-introduce inflation-indexed bonds.
His comments poured cold water on hopes that the central bank may have a rethink on rates after the wholesale price index, the main inflation gauge, rose a lower-than-expected annual 7.25 per cent in June, its slowest rise since January, helped by moderation in fuel prices.
The government is in the process of setting up of an independent debt management office, aimed at separating RBI's role as the decider of interest rate in the market, and at the same time being the banker to the government.
The BSE benchmark Sensex on fell by 54 points in early trade due to profit-booking after two sessions of gains amid disappointing industrial production and retail inflation data.
The RBI cut interest rates on Friday by a quarter point for the third time since January.
Policymakers say falling rupee could lead to rise in prices of imported items such as edible oil and build up inflationary expectations in the economy.
India's growth story will continue despite a slight deceleration, but there will be no recession as in some advanced economies, Reserve Bank of India Governor D Subbarao said on Saturday. Pegging GDP growth for FY'09 at 7.5-8 per cent, he said, this was 'our best growth estimate', even though there were other estimates ranging from 7.2-8.7 per cent.
SBI Chairman Pratip Chaudhuri on Tuesday once again expressed his open disagreement with the RBI on cash reserve ratio (CRR) saying it is a "waste" for the economy and successive interest rate cuts by central bank have failed to contain inflation.
Central bank estimate economy to grow at 5.5 per cent.
Officials, however, said one person's thinking might not change the views of the institution.
RBI raised lending rates to commercial banks 2 per cent to 10.25 per cent making loans costlier.
Amid decelerating manufacturing growth, the Reserve Bank wants the government to come out with measures in the Budget to give a boost to the sector, which can employ surplus labour from agriculture.
India Inc's reactions to the RBI rate cut.
In its Third Quarter Review of Monetary Policy 2012-13, the Reserve Bank of India has reduced the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 8.0 per cent to 7.75 per cent with immediate effect.
In an interview with the Press Trust of India on Sunday, Finance Minister P Chidambaram explained that there was no "antagonism" between his ministry and the Reserve Bank of India (RBI).
A cut in the CRR will help banks release their funds stuck with the RBI on which they do not get any interest from the regulator.
After all, India is the only one among the BRIC nations (Brazil, Russia, India and China) where lending rates are still ruling at their 2008 peaks.
Reserve Bank of India Governor D Subbarao on Friday said he cannot speculate on when he will start cutting policy rates, but assured that the central bank will ensure that there is enough liquidity in the system by conducting open market operations.
In addition, bankers also told Business Standard that they did not expect the central bank to hike policy rates or the cash reserve ratio in the third quarter review scheduled for October 27 as inflation was not rising fast though inflationary expectations were there.
The loan by the banks to MFIs for on-lending to small borrowers will fall under 'priority sector' category if the RBI guidelines are met.
The RBI's assessment of the economy, presented as a prelude to the policy announcement, was relatively downbeat. Conceding the persistence of a hostile global environment and domestic weakness, the RBI expects GDP growth during 2009-10 to be 6 per cent. This is slightly higher than the 5.7 per cent that reflects the median of its external forecasters' survey.
High current account deficit is leading to the rupee weakening.
The Reserve Bank of India on Wednesday said banks' response to monetary actions in terms of cutting interest rates have been mute and there is room for further softening of interest rates.
What the industry and observers have been saying for quite some time -- that there is a lot of regulatory confusion on developing a corporate debt market -- has come out in the open with the RBI Governor and the Plan panel head speaking on the same topic in different languages.
Headline inflation was 8.98 per cent for March, while the food inflation was 8.76 per cent for the week ended April 16.
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