Housing Development Finance Corporation (HDFC) Chairman Deepak Parekh on Tuesday said that interest rates may rise owing to higher inflation, but lending rates are unlikely to change in the next one month.
Quarterly earnings of corporates, trading activity of foreign investors and inflation data are the key factors that are expected to drive the momentum in the equity markets this week, analysts said.
'Where in the world you get 12.5 per cent return of interest?'
Interest rates are expected to remain stable for now despite the Reserve Bank squeezing money supply through a hike in percentage of cash that banks must keep in reserve, ICICI Managing Director and CEO K V Kamath said. Kamath said at this point of time the market has not judged which way interest rates are going, but if yield on 10-year government bond is taken as an indicator, there is in fact a drop in interest rates. The RBI had last month announced a 0.75% hike in CRR.
Bharti Airtel was the biggest gainer in the Sensex pack, rising 1.63 per cent, followed by Tata Steel, ICICI Bank, Titan, Asian Paints and Ultratech Cements. On the other hand, M&M, NTPC, Tata Motors, TCS and PowerGrid were the major losers.
Reserve Bank of India should introduce interest rate options based on Indian rupee benchmark, a financial derivative instrument, to meet future financing requirements of clients, according to the representatives of leading private banks.
Do not keep a large portion of your long-term portfolio in FDs.
Fitch Solutions sees RBI keeping benchmark interest rates unchanged during the fiscal to March 2022 following its decision to buy Rs 1 lakh crore of government bonds. "We had initially expected another policy rate cut to arrest the rise in government bond yields since the Union Budget announcement in February. "However, having an explicit bond purchase guidance from the RBI following the announcement of the G-SAP will also achieve a similar effect, if not even be more effective than a rate cut on capping the increase in bond yields," it said in a note. The Reserve Bank of India (RBI) held its policy repurchase (repo) rate unchanged at 4 per cent at its monetary policy meeting on April 7.
The government is closely watching the movement of prices of five essential items -- steel, cement, sugar, wheat and rice -- besides that of oil in the global market despite inflation dropping to over a two-year low of 3.35 per cent, Finance Minister
Gold prices tumbled by Rs 3,350 to Rs 72,300 per 10 grams in the local market in New Delhi on Tuesday amid subdued demand by jewellers after the government announced the customs duty cut on the yellow metal and silver to 6 per cent.
State Bank of India and Canara Bank said on Thursday interest rates are expected to remain soft and stable in the near future as inflation is down and there is ample liquidity with the banks. "Interest rates are expected to remain stable to down," SBI Chairman O P Bhatt told reporters before participating in a meeting of bankers and exporters with Finance Minister P Chidambaram in New Delhi.
A day ahead of Lok Sabha polls announcement, the government today decided to hike interest rates on fixed deposit schemes offered by post offices by up to 0.2 per cent.
From the Sensex pack, Tata Motors, Sun Pharmaceutical, Bharti Airtel, Bajaj Finserv, ICICI Bank, Mahindra & Mahindra and JSW Steel were the gainers. Tech Mahindra, HCL Technologies, Asian Paints, Titan, Infosys, State Bank of India, Tata Consultancy Services and HDFC Bank were the laggards.
The Reserve Bank of India (RBI) has sought granular data from select non-banking financial companies (NBFCs) on their loan book growth. The details sought are on the outstanding product-wise portfolio and the annualised interest charged on them. The annualised interest slabs mentioned are as follows: less than 10 per cent, 10-20 per cent, 20-30 per cent, 30-40 per cent, 40-50 per cent, and above 50 per cent.
Investors' wealth plummeted by Rs 5.49 lakh crore on Friday as markets faced a massive correction tracking a weak trend in global peers and fresh foreign fund outflows. Falling for the third day running, the 30-share BSE Sensex tumbled 1,017.23 points or 1.24 per cent to settle at 81,183.93. During the day, it plunged 1,219.23 points or 1.48 per cent to 80,981.93.
Ahead of its mid-quarterly policy review, the Reserve Bank today hinted at cut in interest rates, saying moderation in inflation due to lower economic growth and cooling global oil prices provide room for easing monetary policy.
Interest rates in the economy have peaked, but it is difficult to predict whether they would fall just as property prices have in some parts of the country, a senior official of housing lender HDFC said.
The rupee remains overvalued against the currencies of India's trading partners, even as it hit record lows against the dollar in August and September. According to the Reserve Bank of India's (RBI) real effective exchange rate (REER) index, the rupee stood at 5.5 per cent above its fair value in August, down from 7.7 per cent in July. This slight easing followed fears of a US recession and the unwinding of yen carry trades, which exerted pressure on the Indian currency.
'In the short term you keep your return expectations very, very low; in the medium term be prepared to invest and in the long term growth will come and your returns from stocks will be high.'
Debt mutual fund (MF) schemes, which witnessed relatively muted inflows in the past three years, saw a surge in investor interest in April amid election-induced volatility in the equity markets. Active debt funds garnered nearly Rs 66,000 crore net inflows in April, most at least since December 2020.
Inflation and interest rates seem to be on top of everyone's mind at the moment.
In the second policy review under Governor Shaktikanta Das, the six-member Monetary Policy Committee voted 4:2 in favour of the rate cut.
With improvement in the fiscal status of the Union government, interest rates will continue to remain low over the long term, according to Vijay Kelkar, advisor to Union finance minister.
Institute of Economic Growth has warned that rising foreign exchange demand and global interest rates may weaken the rupee and slow down forex accumulation, which is expected to touch $106 billion by March.
'The problem is that the bubble may not only be in valuations, but also in investors' minds.'
The rupee has remained largely stable against the US greenback in the current calendar year (CY 2024), depreciating by just 0.59 per cent so far. However, it has considerably weakened against the euro and pound. The local currency has depreciated by 1.6 per cent against the euro and 5.6 per cent against the pound, as both currencies strengthened against the dollar during this period.
The popular Five-Year National Savings Certificates will earn an interest rate of 8.1 per cent from April 1 as against 8.5 per cent, at present.
There are ways in which you can get a better deal for the interest rate on your car loan, home loan, education loan, personal loan, etc.
The National Housing Bank on Tuesday hiked the interest rates on its capital gains bonds by 0.25-0.35 per cent effective from December 1.
Repo rate may well end 2013 at 8 per cent, where it had begun the year.
The wholesale inflation rose to a 13-month high of 1.26 per cent in April fuelled by rising prices of food articles, especially vegetables, amid expectations of RBI holding interest rates in the policy review next month. The wholesale price index (WPI) based inflation has been rising for two months in a row.
Food inflation came down to 10.35 per cent in the first week of August from over 20 per cent late last year.
Reserve Bank of India governor D Subbarao said the rapid expansion of the government borrowing programme was coming in the way of the central bank's monetary policy objective of a lower interest rate regime and called for more independence for the central bank.
'Margins will be an outcome of that. They will likely remain somewhat range-bound.'
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