There's only a slim chance of a substantial drop.
With average returns of 18 per cent over the past year, listed real estate investment trusts (Reits) have clearly outperformed both the Nifty Realty index and the Sensex. Over the same period, Nifty Realty fell 15.5 per cent, while the benchmark index was largely unchanged. Steady office leasing, the Securities and Exchange Board of India's (Sebi's) decision to reclassify Reits as equity instruments, and ongoing portfolio expansion have strengthened the sector's appeal.
Exporters on Thursday sought a fund of Rs 750 crore for three years to tap USD 25 billion export potential in the US, aiming to seize potential opportunities that may arise as the US President-elect, Donald Trump, has threatened to impose high tariffs on Chinese goods. In its pre-Budget meeting with the finance ministry, Federation of Indian Export Organisations (FIEO) President Ashwani Kumar has also demanded extension of the five per cent Interest Equalisation Scheme (IES).
Will your home loan rates drop now that the RBI has signalled the onset of lower interest rates after 0.25 per cent cut in repo rate and CRR?
Net profit of 19 listed banks is likely to decline by 4 per cent year-on-year (Y-o-Y) for the quarter ended March (Q4FY25) mainly due to pressure on net interest margins (NIM) as a result of rate cut by the Reserve Bank of India (RBI), according to analysts' estimates. Additionally, loan growth is expected to further slowdown amid low demand in certain secured products, stress in the unsecured segment, and a high cost to deposit (CD) ratio across the system.
SBI is the third state-run lender to lower the lending rates after Indian Overseas Bank Tuesday and Bank of Maharashtra which also lowered their loan prices by 5 bps on loan tenors of one year and above, effective April 10.
In the face of hike in repo rate, all leading banks, including State Bank of India, ICICI Bank, Corporation Bank and Bank of Baroda, are exploring the possibility of raising deposit and lending rates.
The Bank Rate (6%), Repo Rate (7.75%) and Reverse Repo Rate (6%) have all been left unchanged in the half-yearly review of the monetary policy on Tuesday.
One should avoid keeping excessive funds in one's savings account.
As the policy rate has seen a steady increase since May 2022, the percentage of loans offered at interest rates below 8 per cent have declined sharply, dropping from 53 per cent in March 2022 to 18 per cent by June 2023, according to a report by the Reserve Bank of India (RBI). The share of bank loans with interest rates of 10 per cent or higher rose from 22 per cent to 34 per cent during this period, reflecting the impact of a 250 basis point (bps) hike in the policy repo rate by the RBI's Monetary Policy Committee. In response to the rise in repo rate, 32 domestic banks have made corresponding upward revisions to their repo-linked external benchmark-based lending rates (EBLRs), aligning them with the magnitude of the rate hike.
In its policy review meeting on Tuesday, the Reserve Bank of India hiked interest rates by 25 basis points.
The central bank might raise repo and reverse repo rates by 25 basis points each, they said. Still, RBI action would be conditional on its ensuring sufficient liquidity in the banking system.
The raising of key rates by the Reserve Bank of India is expected to ease the transition to the base rate mechanism, which came into effect from July 1.
Ahead of RBI's monetary policy review, SBI on Monday expressed hope the apex bank will cut interest rates by 0.5 per cent and CRR by up to one per cent to boost sagging growth.
Concerned over surging inflation, Reserve Bank of India hiked the short-term repo rate on Wednesday by 0.25 per cent to 7.50 per cent while keeping reverse repo, bank rate and cash reserve ratio unchanged.
The Reserve Bank's rate-setting panel, Monetary Policy Committee (MPC), began its three-day deliberations on Wednesday amid expectations of a status quo on benchmark rate mainly on account of uncertainty over the impact of the second wave of COVID-19 pandemic. Moreover, the fears of firming inflation may also refrain the MPC from tinkering with the interest rate in its bi-monthly monetary policy outcome to be announced on Friday. The RBI had kept key interest rates unchanged at the last MPC meeting held in April.
Rediff.com interviewed people from several walks of life to know their opinions on the rise in rates by RBI.
RBI had previously cut repo rate by 0.25 per cent each in January and March.
FDs are not advisable for long-term wealth creation as their post-inflation, post-tax returns are not very attractive.
Economists say RBI to raise policy rates in annual policy statement in April.
In his first monetary policy review since taking office on September 4, RBI Governor Raghuram Rajan increased the repo rate by 25 basis points to 7.50 per cent.
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.
RBI Governor has been under pressure from Finance Ministry.
Reserve Bank Governor Shaktikanta Das on Wednesday said the decision to tweak policy rates was not in his hand as he himself is driven by the situation on the ground. In April, the Reserve Bank in a surprise move hit the pause button and decided to keep the key benchmark policy rate at 6.5 per cent. Prior to it, the Reserve Bank of India (RBI) was on a rate hiking spree, raising the repo rate by 250 basis points since May 2022.
Bankers do not expect any major changes in key interest rates by the Reserve Bank in its quarterly review of the monetary policy on October 31.
Two members recommended bringing down the rate by 50 bps in the April policy.
A spiralling inflation is likely to force the Reserve Bank of India to up the Cash Reserve Ratio by 0.75 per cent in FY 09, along with a 1 per cent hike in repo and reverse repo rates, global financial services major, StanChart said.
High interest rates have been discouraging fresh investments and dragged industrial production down for nearly two years now.
The RBI has set up a panel to review ATM charges, and fees levied by banks.
In the mid-year monetary policy review on Tuesday, RBI, left the key interest rate unchanged but reduced cash reserve ratio by 0.25 per cent to infuse additional liquidity of up to Rs 17,500 crore (Rs 175 billion) into the system.
'Although we are facing constraints related to lending and resource mobilisation, the government is aware of these.'
Opinions vary, but fund managers remain bullish.
Discuss how high inflation and interest rates are impacting you with Senior Associate Editor (Business)Faisal Kidwai.
'The rate cut could have been higher in the current economic conditions which would have had a stronger impact on business sentiment and spurred investment in a big way.'
RBI, in its first bi-monthly monetary policy statement, left the short-term lending rate, or repo rate, unchanged at 8 per cent and the cash reserve ratio static at 4 per cent.
The Reserve Bank of India in its quarterly monetary policy review has hiked rates.
State Bank announced a 15 basis points reduction in its lending rates, effective August 10 across all tenors.
RBI Governor Raghuram Rajan asked banks to follow suit and pass on the rate cuts.
The Reserve Bank of India on Wednesday evening increased the repo rate -- the rate at which the central bank's lends short-term money against government securities to banks -- by 25 basis points to 8 per cent.
