India continues to remain an attractive investment destination and rise in repatriation of funds is a sign of a mature market where foreign investors can enter and exit smoothly, Reserve Bank Governor Sanjay Malhotra said on Friday. Gross foreign direct investment (FDI) inflows remained strong, rising by around 14 per cent to $81 billion in 2024-25, from $71.3 billion a year ago.
Benchmark Sensex advanced 110 points in a choppy trade on Wednesday, extending its gains to the fourth day in a row helped by buying in HDFC Bank, ICICI Bank and fresh foreign fund inflows. The 30-share barometer rose by 110.58 points or 0.14 per cent to settle at 80,956.33 with 14 of its constituents ending with gains and 16 stocks with losses. During the day, it jumped 399.64 points or 0.49 per cent to 81,245.39 and dipped to a low of 80,630.53.
To ease the potential liquidity stress, the Reserve Bank on Friday slashed Cash Reserve Ratio (CRR) by 50 basis points to 4 per cent, a move that would unlock Rs 1.16 lakh crore bank funds. The RBI on May 4, 2022 had raised CRR to 4.5 per cent from 4 per cent in an off-cycle Monetary Policy Committee (MPC) meeting, with effect from May 21 the same year.
'Only four or five original companies remain; the rest have been replaced every decade as sectors evolve or leadership shifts.' 'Companies that fail to adapt -- like many textile mills from the 1970s and shipping firms from the 1980s -- disappear.' 'Benchmark indices reward those who reinvent themselves in line with economic demands.'
Titan, Nestle, Hindustan Unilever, State Bank of India, Larsen & Toubro, ITC, Zomato and Bajaj Finserv were also among the laggards. Adani Ports, IndusInd Bank, Tata Motors and HDFC Bank were among the major gainers.
The RBI under former governor Shaktikanta Das resisted pressures to cut interest rates through 2024 as it kept its 'Arjuna's eye' trained on inflation, but the central bank under a new detail-oriented head will soon have to take a call if it can continue sacrificing growth. Das, a career bureaucrat who in 2016 oversaw Prime Minister Narendra Modi's highly disruptive demonetisation move, left a lasting legacy as he demitted office towards the end of 2024 after expertly navigating monetary policy for six years, the highlight of which was steering India's recovery through the pandemic.
'If it doesn't, it will continue with measures to infuse liquidity, signalling a new cycle,' predicts Tamal Bandyopadhyay.
India will be the world's third-largest economy by 2028 as it becomes the world's most sought-after consumer market and gains share in global output, driven by macro stability influenced policy and better infrastructure, Morgan Stanley said. From a $3.5 trillion economy in 2023, the Indian economy is projected to expand to $4.7 trillion in 2026, which will make it the fourth largest in the world behind the US, China and Germany.
The size of the Reserve Bank's balance sheet as on March 31, 2025 increased by 8.20 per cent year-on-year, leading to a bumper dividend of Rs 2.69 lakh crore for the central government. Increase on assets side was due to rise in gold, domestic investments and foreign investments by 52.09 per cent, 14.32 per cent and 1.70 per cent, respectively, said the RBI's Annual Report for the Year 2024-25 released on Thursday.
Since Sanjay Malhotra took office as governor in December, the Reserve Bank of India (RBI) has adopted a more accommodative stance, which bodes well for banking and the economy as they navigate a growth slowdown, according to analysts.
The Reserve Bank is unlikely to cut the benchmark interest rate in its forthcoming bi-monthly monetary policy review later in the week as retail inflation is still a cause of concern, and there is a possibility of the Middle East crisis deteriorating further, impacting crude oil and commodity prices, say experts.
The Reserve Bank of India's (RBI) Monetary Policy Committee's (MPC) decision to cut the repo rate by 50 basis points (bps) to 5.5% was contrary to the expectations of many economists. Firstly, most of the economists expected the MPC to cut the repo rate by 25 bps citing the weakening of inflation, prospects of economic growth, geopolitical uncertainty and comfortable system liquidity.
Sanjay Malhotra takes charge as the 26th RBI governor at a time when headline retail inflation has shot up to 6.2%.
Among Sensex firms, Eternal, Infosys, Asian Paints, HDFC Bank, Bajaj Finserv and Titan were the major gainers. However, Tata Steel, Tech Mahindra, Adani Ports and Bharat Electronics were among the laggards.
Wholesale inflation fell to a 3-month low of 2.04 per cent in July on decline in prices of food items especially vegetables, government data released on Wednesday showed. The decline in wholesale price index (WPI) based inflation in July came after it rose for four months in a row till June, when it was 3.36 per cent. It was (-) 1.23 per cent in July last year. In April wholesale inflation stood at 1.19 per cent.
Perhaps because the Modi government had some differences of opinion with two of the economist governors (one of whom was appointed by the Manmohan Singh government), there is a view that its political leadership prefers a civil servant to head the RBI, notes A K Bhattacharya.
'Growth, liquidity and deposit mobilisation are likely to be discussed during the interaction.'
Shaktikanta Das will demit the office on Tuesday after completing six years as the 25th Governor of the Reserve Bank of India. Revenue Secretary Sanjay Malhotra will replace him as the 26th Governor. He was appointed as the Governor on December 12, 2018, after the abrupt exit of Urjit Patel.
Wholesale price inflation rose to a 4-month high of 2.36 per cent in October as prices of food items, especially vegetables, and manufactured goods turned dearer, as per the government data released on Thursday. The wholesale price index (WPI) based inflation was 1.84 per cent in September 2024. It was (-) 0.26 per cent in October, last year.
Gold and silver prices are expected to maintain their upward trajectory this week, but may see late profit-booking amid the release of a series of crucial global economic indicators, analysts said. On the economic front, traders will closely monitor the manufacturing/ services PMI data from across regions and the US non-farm payrolls/ employment data along with consumer confidence for the month of September and speeches from several Federal Reserve officials, they added.
'Maintain a balanced approach with a preference for short-to medium-duration funds.'
The Reserve Bank of India on Friday retained its projection for retail inflation at 4.5 per cent for the current fiscal assuming a normal monsoon, while emphasising that uncertainties related to food price outlook warrant a close monitoring. Consumer Price Index (CPI)-based retail inflation has been projected at 4.5 per cent with quarter-wise projections at 4.9 per cent in Q1 (April-June), 3.8 per cent in Q2, 4.6 per cent in Q3, and 4.5 per cent in Q4.
A day after his appointment as the 26th governor of the Reserve Bank of India (RBI), outgoing Revenue Secretary Sanjay Malhotra on Tuesday said one must understand the economic landscape and do what was best for the economy. "Let me first go, join, understand the turf ... Here it is a different role," Malhotra said, speaking to reporters in front of North Block.
The Reserve Bank's rate-setting panel began its three-day deliberations on Monday to decide the next monetary policy amid expectations that the central bank will maintain status quo on the benchmark interest rate in the backdrop of global scare due to the new coronavirus variant Omicron. Reserve Bank Governor Shaktikanta Das headed six-member Monetary Policy Committee (MPC) is scheduled to announce the policy resolution on Wednesday. If the RBI maintains status quo in policy rates on Wednesday, it would be the ninth consecutive time since the rate remains unchanged.
Titan, HCL Tech and State Bank of India were also among the laggards. However, Hindustan Unilever, Asian Paints, ICICI Bank, Power Grid, HDFC Bank and ITC were the gainers.
GST Reform 2.0, which trims tax slabs from four to two, signals a push for demand-led growth, and together with recent income tax cuts, sets the stage for sustained economic growth, experts said. The Goods and Services Tax (GST) Council on September 3 approved an overhaul of the indirect tax regime by taxing essentials at 5 per cent and other goods at 18 per cent. A new 40 per cent tax will be applicable on luxury and sin items.
The Reserve Bank of India's (RBI's) job to bring down inflation is not over, and any premature move on the policy front could undermine the success achieved so far on the price situation, according to RBI Governor Shaktikanta Das. RBI's rate setting panel, Monetary Policy Committee (MPC), had met for three days from February 6-8. The panel decided to leave the key policy rate unchanged at 6.5 per cent for the sixth time in row.
If Xi Jinping is dethroned in the future, the instrument for that may well be embedded within the PLA, notes former foreign secretary Shyam Saran.
Even as the high inflation figure for October has ruled out any possibility of a rate cut by the Reserve Bank of India's (RBI's) monetary policy committee (MPC) in December, a rate cut in February also looks uncertain due to global uncertainties. Economists told Business Standard that unless domestic growth slows markedly, the outlook on rate cut remains unclear. India's headline inflation touched a 14-month high of 6.2 per cent in October, breaching the MPC's upper tolerance band of 6 per cent.
RBI's interest rate decision, macroeconomic data announcements and global trends are the key factors that would dictate the momentum in the equity market this week, analysts said.
The Reserve Bank of India (RBI) does not target any price level on the rupee, Governor Sanjay Malhotra reiterated at an International Monetary Fund and World Bank event on Wednesday.
The US Fed interest rate decision, inflation data and FIIs are the key factors that are expected to drive stock markets this week, analysts said. Global trends will also be tracked by investors for further cues, they added. "The Indian stock market's future trajectory will be influenced by a blend of global and domestic factors.
Credit quality of Indian corporate is expected to be stable in the second half of the current financial year (H2FY26), supported by easing monetary cycle, and declining inflation, coupled with income-tax relief and rationalisation of the goods and service tax (GST) rates, among others.
ITC Hotels on Friday reported nearly 74 per cent rise in consolidated net profit for the second quarter ended September at Rs 133.29 crore, on higher revenue from operations. The company, which listed on the stock exchanges earlier this year post its demerger from ITC Limited, had posted a net profit of Rs 76.63 crore a year ago.
Retail inflation slipped to seven-month low of 3.61 per cent in February mainly due to easing prices of vegetables, eggs, and other protein-rich items, creating space for the RBI to go for another cut in interest rate next month.
Retail inflation breached the Reserve Bank's upper tolerance level, soaring to a 14-month high of 6.21 per cent in October mainly on account of rising food prices. Inflation based on the consumer price index (CPI) was 5.49 per cent in September and 4.87 per cent in the year-ago month. Retail inflation trended below the RBI's upper tolerance band of 6 per cent since September last year.
The Reserve Bank of India on Thursday decided to keep policy rate unchanged for the sixth time in a row as it maintains a tight vigil on inflation. The rate increase cycle was paused in April last year after six consecutive rate hikes aggregating to 250 basis points since May 2022.
Days after the US Fed raised the interest rate, the RBI may go in for its third consecutive policy rate hike by at least 35 basis points to check high retail inflation, experts said. The central bank has already announced to gradually withdraw its accommodative monetary policy stance. The Reserve Bank of India's rate-setting panel -- the Monetary Policy Committee -- will meet for three days from August 3 to deliberate on the prevailing economic situation and announce its bi-monthly review on Friday.
Wholesale price inflation (WPI) declined to a 14-month low of 0.39 per cent in May on easing prices of food articles and fuel, and experts said geopolitical tensions could push up prices.
Facing criticism from the government over the central bank prioritising inflation over growth, the new RBI Governor Sanjay Malhotra on Monday said that prospects of the Indian economy are expected to improve on the back of high consumer and business confidence in 2025. "As we strive to preserve financial stability to support a higher growth path for the Indian economy, our focus remains steadfast on maintaining stability of financial institutions and, more broadly, systemic stability," Malhotra said in foreword to the Financial Stability Report.
