Indian food inflation rises 11.43%

Indian food inflation rises 11.43%The food inflation in India rose 11.43% this week, according to the latest data released on Thursday.

The fuel price index climbed 14.70% in the year to October 15. The food price index and fuel inflation stood at 10.60% and 15.17%, respectively in the previous week. The primary articles price index rose was up 11.75%, compared with an annual rise of 11.18%.

RBI’s stance on interest rates affects growth

RBI’s stance on interest rates affects growthThe Reserve Bank of India (RBI) has maintained a rigid approach of increasing interest rates in order to curb inflation, which refuses to fall to acceptable levels in the country.

The central bank has raised its key benchmark rates 12 times in 18 months causing the growth in the country to slowdown. Market analysts were earlier supportive of the stance to some extent but over the time, they have been frustrated with the rigidity and look at the raising of the rates with dismay because of it has been largely ineffective in tackling infalation.

Loan take-ups are on the rise, RBI

RBIAccording to the latest data released by the Reserve Bank of India, the loan take-ups by customers is beginning to rise in the country as banks record higher disbursements.

Commercial banks in the country disbursed loans amounting to Rs 55,443 crore in the fortnight till October 7, 2011 compared to Rs 18,860 crore in the earlier fortnight period. Banks are seeing a growth in working capital loans and to some extent in retail loans.

However, they point out that the more take-ups are not being finalized because capital expenditure proposals for setting up new projects and expanding capacities are not being planned now because of high interest rates.

Inflation must come down before any rate cuts, RBI governor

Inflation must come down before any rate cuts, RBI governorDuvvuri Subbarao, the governor of the Reserve Bank of India has said that inflation in the country must come down for considering any cuts in the interest rates by the central bank.

We are deeply sensitive in making India a low interest- rate regime but that will take time. First, we need to bring inflation down in order to bring interest rates down,” said Subbarao. He said that the several developing economies are now more focused on generating growth instead of fighting high inflation due to the struggling US economy.

India's inflation in August at 9.78 percent

India's inflation in August at 9.78 percentNew Delhi, Sep 14: India's inflation in August inched closer to double digits to 9.78 percent, giving no respite to policymakers and the common man and raising the possibility of another interest rate hike by the Reserve Bank of India (RBI).

Based on the wholesale price index, the annual rate of inflation in August stood at 9.78 percent, compared to 9.22 percent for the previous month and 8.87 percent in August 2010, according to data made available by the ministry of commerce and industry ministry.

India’s Industrial Output on Decline

India’s Industrial Output on DeclineOn Monday, data procured from the Government of India has revealed that the country’s industrial out for the month of July stood 3.3% lower than last year’s. However, the industrial output for the month of June stood stable.

Although the industrial output was lower than expected, the manufacturing output rose significantly by 2.3% in July. It is believed that because of the slower growth may force RBI to push the rates on the coming Friday.

Inflation Woes of Indian Commoner

Inflation Woes of Indian CommonerIt is expected that there might again be a rise in the interest rates by the RBI. The inflation in the nation has seemed to take the better of it since a long time and there seems no respite soon for India. RBI is taking all necessary measures to be able to fight inflation and make things easier for the common man.

RBI Issues Guidelines for New Banks

RBI Issues Guidelines for New BanksReserve Bank of India, the controlling bank of the nation, has recently issued a set of guidelines for the new private banks of the industry. This is going to take the industrial sector to the planned Rs 64 trillion sectors.

These rules are of the fact that only those firms in the private sector, who have had a clean track record with strong financial position since past ten years shall be allowed to get license for bank.

These firms are not allowed to have more than 10% of their income or assets from the real estate sector.

New Laws Proposed by RBI Governor

New Laws Proposed by RBI GovernorGovernor of the Reserve Bank of India, Duvvuri Subbarao, has emphasized on the need to regulate laws on lending, prior to the commencement of business in the banking sector.

The bank will be presenting the new rules of licensing after the amendment to the act has been framed. As per Duvvuri Subbarao, “We have sent in a draft amendment to the Banking Regulation Act to the government. The government is working on it. The amendments are necessary before we can contemplate corporate entry into the banking system”.

India’s GDP Growth to Touch 7.5% this Fiscal

India’s GDP Growth to Touch 7.5% this Fiscal During an interview with CNBC-TV18, the Head of India & South East Asia Economics Credit Suisse, Robert Prior-Wandesforde has anticipated that RBI will hike the interest rates by 25basis points at the next credit meeting, scheduled to be observed on September 16. In addition, he believes that India’s GDP growth will hit 7.5% in this fiscal and next fiscal. Also, Robert Prior-Wandesforde claimed that there are a number of candidates within Asia that are much more at risk to significant downgrades.

India’s RBI Panel Divided over Hiking Interest Rates in July: Reports

India’s RBI Panel Divided over Hiking Interest Rates in July: ReportsIn a recent report, it has come to light that not everyone was fine about increasing interest rates last month on July 26 on the 12-member RBI panel. As per reports, four of the 12 members were keen on adopting a “wait and watch policy”, while three pressed for it and one proposed a 25 basis-point boost to the cash reserve ratio.

Committee Recommends Customer Friendly Services to RBI

Committee Recommends Customer Friendly Services to RBIReserve Bank of India’s approval, on various recommendations made by a committee to improve the customer services by banks, is expected to solve many problems. With the implementation of recommendations, the customers will enjoy improved banking services.

The committee is being controlled by previous Sebi chief M Damodaran, who has proposed certain guidelines, which if followed can prove to be consumer-friendly. The major issue being resolved from the recommendations will be the fluctuation in the interest rates that provided privilege only to the upcoming customers.

RBI Indicates To Raise Its Key Policy Rates

RBI Indicates To Raise Its Key Policy RatesOn Monday, the Reserve Bank of India said that taming inflation warrants continuation of the anti-inflationary monetary stance. The central bank has indicated to raise its key policy lending rates by 25 basis points at a policy review scheduled for July 26, 2011.

Reserve Bank of India Increases Repo and Reverses Rates 50 Points Each

Reserve Bank of India Increases Repo and Reverses Rates 50 Points EachThe Reserve Bank of India is reported to have increased repo and reverse the rates by 50 points each, which is higher than expected. Hence, the repo rate which RBI lends banks has surged to 8%, while reverse, the rate it borrows has gone up to 7%.

Also, the cash reserve ratio was still the same at 6% and Anant Narayan of Standard Chartered Bank, stated: "This policy action was out of syllabus and to that extent the market will recalibrate its expectations and reactions subsequently”.

RBI Expects Inflation to Reach 6% by March 2012

RBI Expects Inflation to Reach 6% by March 2012The projections made by the Reserve Bank of India to rein in inflation to 6 % by end-March 2012, look to many a far dream. While the Central Bank is tracking the inflation rate, the economy is expected to cool in the near future.

Fueled by hike in petrol prices and manufactured goods, India’s wholesale price inflation notched up in June to an annual 9.44% from 9.06% in May. What could be the possible steps the Central Bank would take to tame the inflation, was pretty much clear in a poll conducted by The Reuters.

RBI May Raise Repo Rate by 25 Basis Points

RBI May Raise Repo Rate by 25 Basis PointsAs per reports of ICRA on weekly food inflation, WPI inflation has increased by 9.4% in June 2011. The high rates in WPI inflation were due to June’s revised prices for kerosene, diesel and LPG known as fuel index and also due to mineral index which reflected commodity prices. In May 2011 the overall WPI was 9.1%. There has been an increase, but it was still less than ICRA expected number- 9.7%.

RBI Restricts Equity Investment

RBIOn the last day of every quarter, the Reverse Bank of India develops the balance of payments for the next quarter and combines statements, texts and charts. The RBI has become the primary source for information when it comes to the external sector.

The RBI is meant to compile necessary documents and make it widely available to external payments for the purpose of analysis. The most important thing necessary is to make sure that the ratio of current account deficit to gross domestic product is balance. The balance of payments is presented and also compared to past quarters.

RBI Lowers Its Fine Penalty on Citibank

RBI Lowers Its Fine Penalty on CitibankThe Reserve Bank of India (RBI) has reduced its previous fine of Rs. 50 lakh to Rs. 25 lakh on Citibank after finding it guilty for violating anti money laundering (AML) and "know your customer" norms.

For long, Citibank was successfully hiding its fraud but a single blunder made by its Relationship Manager, Shivraj Puri, brought its true image in the public.

RBI Appoints HR Khan as Deputy Governor

RBI Appoints HR Khan as Deputy GovernorMr. Harun Rashid Khan has been appointed as new Deputy Governor of Reserve Bank of India for a tenor of three years. It has come to light that RBI Governor D Subbarao suggested the name of Mr. HR Khan and G Gopalakrishna for the post of Deputy Governor.

As a new Deputy Governor, Mr. HR Khan will be responsible for handling portfolios like Central Security Cell, Department of External Investments and Operations, Department of Government and Bank Accounts, Department of Payment and Settlement Systems, Internal Debt, Foreign Exchange Department, Management Department and Inspection Department.

RBI Extended FCCB’s Buyback Limit

RBI Extended FCCB’s Buyback LimitThe Reserve Bank of India (RBI) has announced the extension for the buyback of foreign currency convertible bonds (FCCBs) issued by various companies. A 9 months extension has been given after taking into account the fragile equity market which has resulted into trading with high discounts on the bonds.

However, experts are of the view that the decision won’t have much effect as most of the bonds will mature in the coming 12 months.

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