RBI Governor D Subbarao is expected in the capital on Friday to hold pre-policy consultations with Finance Ministry officials.
Reserve Bank of India (RBI) Governor Shaktikanta Das said on Friday said the central bank has developed an innovative artificial intelligence and machine learning (AI/ML) based model MuleHunter.ai to address the growing issue of mule bank accounts that are often used for committing financial fraud. Developed by the Reserve Bank Innovation Hub, the new initiative is piloted with two public sector banks.
For those, like me, who backed the Reddy-Mohan approaches to monetary and regulatory policies, the continuity shown by Subbarao's RBI is very heartening. For earlier critics of these approaches there may be some disappointment and discomfort.
Investors were focussed on the RBI's monetary policy review on Tuesday which will give an insight into its inflation and rates outlook.
India needs to be technologically and militarily prepared to defend itself from both Pakistan and China, alerts Ramesh Menon.
The services sector growth in India fell to a one-year low in November on softer expansions in new work intakes and output, despite receding price pressures, a monthly survey said on Tuesday. The seasonally adjusted S&P Global India Services Business Activity Index fell from 58.4 in October to a one-year low of 56.9 in November. Despite witnessing a month-on-month decline, the rate of expansion was stronger than its long-run average.
The Reserve Bank's rate setting panel on Thursday met to finalise a report for the government on why it failed to keep retail inflation below the target of 6 per cent for three consecutive quarters since January this year, said sources. The report will be presented to the government as per the Reserve Bank of India Act, they added. The six-member Monetary Policy Committee (MPC) is headed by Governor Shaktikanta Das.
Bank lending has seen a significant fall. RBI needs to bring liquidity into the system immediately.
The Reserve Bank's annual monetary policy will moderate inflation without hurting growth, while providing relief to small housing loan borrowers, Finance Minister P Chidambaram said on Tuesday.
'Even if there is a third wave or a fourth wave, it is hard to see the economy will suffer like that (during the first wave).'
The author of Riding the Indian Tiger says the inevitable end of U.S. dependence on oil will have far-reaching consequences for both consumer and producer nations
'The central bank has highlighted that the slowdown in growth has been limited to a few sectors and overall growth is expected to pick up in the second half of the year.'
Reserve Bank is scheduled to announce its bi-monthly monetary policy on August 3.
Citing various macroeconomic parameters that are doing pretty well, India's G20 Sherpa and former CEO of Niti Aayog Amitabh Kant projected that the country is all set to overtake Japan as 4th largest economy in the world by 2025. The size of India's GDP is currently ranked 5th, after the US, China, Germany, and Japan. It overtook the UK in 2022.
According to report by Dun and Bradstreet, central bank expected to maintain status quo on policy rate.
The Reserve Bank on Thursday marginally revised upwards the economic growth projection for the current fiscal to 6.5 per cent, from its earlier estimate of 6.4 per cent. Unveiling the first bi-monthly monetary policy of 2023-24 fiscal, RBI Governor Shaktikanta Das said the GDP growth in the first quarter of 2023-24 is expected at 7.8 per cent.
Soaring vegetable prices pushed the retail inflation rate to a nine-month high of 5.49 pr cent in September, according to government data released on Monday. The consumer price index (CPI)-based retail inflation rate was 3.65 per cent in August and 5.02 per in September 2023. The previous high inflation rate was witnessed in December 2023 at 5.69 per cent.
Markets ended lower on Monday as investors turned cautious and booked profits ahead of the RBI monetary policy.
The MPC headed by RBI Governor Shaktikanta Das will announce the resolution of the meeting at around noon on Thursday.
With no rate cuts on the table, the other monetary policy alternative could be to reduce the width of the asymmetric policy corridor or increase in reverse repo rate when the pandemic subsides, they opined.
Central bank estimate economy to grow at 5.5 per cent.
IT and interest rate-sensitive bank, realty, and auto stocks ended with sharp gains.
Similarly, 51 per cent of 105 market participants polled by RBS said they do not expect a CRR cut in the quarterly policy announcement next Tuesday.
Das said that global economic activity has remained fragile and the surge in COVID-19 cases has subdued early signs of revival.
Dr Nagesh Kumar, one of the three new MPC members, wanted the MPC to reduce the repo rate by 25 basis points to 6.25%.
Fundraising via initial public offers (IPOs) dropped 52.2 per cent to $147.2 billion in the first eight months of calendar year 2023 (CY23), suggests a recent report by GlobalData, a London-based analytics and consulting company. At the country level, the report suggests, India topped the charts with 152 transactions worth $3.8 billion during this period, primarily due to a higher number of SME IPOs, followed by the US with 99 deals totaling $16 billion, while China ranked third with 88 transactions worth $32.3 billion. "An analysis of GlobalData's Deals Database reveals that there were 750 IPO listings registered with an aggregate deal value of $147.2 billion in the first eight months of 2023 on the stock exchanges worldwide.
After infusing Rs 1,85,000 crore (Rs 1850 billion) liquidity into the banking system this month, RBI on Friday surprised the market by keeping its key rates unchanged in the mid-term review of annual monetary policy, which lowered economic growth projections to 7.5-8 per cent for 2008-09.
Rajan warned against waiting to act until inflation expectations become entrenched, but also said the Reserve Bank of India would overlook temporary spikes in inflation.
The finance ministry expects a broad-based moderation in inflationary pressures on the back of an anticipated reduction in food prices as a result of the uptick in summer sowing. The retail inflation rate remained stubbornly clung to the 5 per cent mark in seven of the past eight months. "Core inflation is trending downwards, indicating a broad-based moderation in price pressures... Driven by strong domestic growth and benign global commodity prices, core inflation is declining continuously.
The International Monetary Fund (IMF) on Tuesday lowered India's economic growth projection for the current fiscal to 5.9 per cent from 6.1 per cent earlier. Yet India will continue to be the fastest-growing economy in the world. In its annual World Economic Outlook, IMF also lowered the forecast for 2024-25 fiscal (April 2024 to March 2025) to 6.3 per cent from the 6.8 per cent it had predicted in January this year. The growth rate of 5.9 per cent in the 2023-24 fiscal compares to an estimated 6.8 per cent in the previous year.
Shares of state-owned bank stocks were under pressure on Monday due to muted deposit and credit growth numbers reported by these lenders in the October-December quarter (Q3) of 2024-25 (FY25). The Nifty PSU Bank index was down 4 per cent, with Union Bank of India emerging as the biggest loser as its shares fell 7.5 per cent to close at Rs 114.7, followed by a 5.7 per cent drop in shares of Bank of Baroda (BoB) to Rs 228 and a 4.7 per cent slide in shares of Bank of India to Rs 99.8 on the National Stock Exchange.
Attainment of growth and price stability through isolated measures by RBI may not be the most effective way
The US Federal Reserve's interest rate decision is the biggest event that would drive sentiments in the domestic stock market this week, besides a host of macroeconomic data from the global front and trading activity of foreign investors, analysts said. The Indian equity market had an exceptional last week, with both the Nifty and Sensex hitting their all-time high levels on Thursday.
Policy with regard to the foreign banks is part of his five pillars of reforms, says RBI Governor.
Welcoming the Reserve Bank of India's monetary policy, the industry chambers on Tuesday said the central bank's 6.5-7 per cent growth projection for this year was in line with their expectations.
'Investors can consider staying invested in long duration products as there is a possibility of rate cuts in the near term.' Positive macros - lower inflation, high forex reserves and favourable demand-supply dynamics for government bonds - make a strong case for rate cuts from December, says Devang Shah, head of fixed income, Axis Mutual Fund. In an interview with Abhishek Kumar in Mumbai, Shah says this view may not hold true if commodity prices go up sharply.
This is important because he is to be seen as a sure winner before criss-crossing the state to campaign for candidates of the party or an alliance, highlights N Sathiya Moorthy.
Fitch Ratings on Thursday retained India's growth forecast for the current fiscal at 6.3 per cent citing economic resilience despite tighter monetary policy and exports weakness, but upped year-end inflation projection on El Nino threat. The Indian economy grew 7.8 per cent in the April-June quarter of current fiscal on strong services sector activity and robust demand. "The Indian economy continues to show resilience despite tighter monetary policy and weakness in exports, with growth outpacing other countries in the region," Fitch said, while projecting 6.3 per cent growth for current fiscal (April-March), and 6.5 per cent for next fiscal.
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.
While the economy seems to be on a firm growth path, the fight against inflation is not over yet. Shaktikanta Das seems to be in no hurry. After playing well through a five-year Test match, he doesn't want to get out hit wicket, observes Tamal Bandyopadhyay.
