RBI

Rate hike giving jitters to bond yields

Rate hike giving jitters to bond yieldsEarnings on India’s government bonds, 10-year is in place to increase over the rate of inflation for the initial time starting January as the central bank domesticated prices.

Inflation- attuned earnings closed previous week at unenthusiastic 0.57 percent, contrasted with excluding 3.1 percent at the concluding of May, as the standard wholesale price index modest from 10.6 percent to 8.62 percent. The Reserve Bank of India estimation of the speed of price hikes will sluggish to 6 percent by the conclusion of the recent fiscal year in March.

RBI intervention rages debate

RBI intervention rages debateSoon after the Central bank of the country, the Reserve Bank of India bought close to $400 million from the forex market on Thursday, the debate has again raged as it was the first intervention of the central bank into the markets this year.

The experts are of a view that the move was to stop the rupee from rising further in the face of huge dollar inflows chasing Indian equities.

RBI may hike rates after September

RBI may hike rates after SeptemberAs the headline inflation has already registered a minor rise in the month of September, the food items have already become costlier.

However, the rise has instantly prompted a prominent voice in the government called C. Rangarajan to urge an action on the same by the Central bank. It is to be mentioned here that the inflation level based on the revamped wholesale price index based rose to 8.62% in September from 8.51% in August.

It is expected that the inflation may force RBI to life the level of the lending rates once again in the coming times despite a weak 5.6% industrial growth in August.

RBI may trek policy rates as Inflation moves at 8.62%

RBI may trek policy rates as Inflation moves at 8.62%Geared up by elevated prices of important items, inflation enthused up to 8.62 per cent in the month of September, with experts expressing that it shall induce the RBI to trek its short-range borrowing and lending rates at subsequent month's policy evaluation.

Though, this is the next successive month where in which the complete inflation has hanged about in the solitary digit. It had stayed above 10 per cent for five months till the month of July.

Call rates stable, banks convene fund wants via RBI

RBIIndian overnight cash rates were stable in afternoon trades on Thursday as the majority of banks met requirement by the central bank's repo borrowing window. Liquidity is predictable to get tilted next week, subsequent payment of Coal India IPO carry on to the not many banks positioning the subject. A small number of banks organizing the IPO shall collect all the money, benefit from the float for a moment.

They shall put in their money in extra instruments. So, in general liquidity won't be very tight, but skewed. Call rates shall increase," expressed by a dealer with a foreign bank.

What to look in the week ahead

What to look in the week aheadIt is expected that the country will see its factory output numbers in the coming week which is expected to ease off the pressure on the Central Bank to lift the key interest rates in the country.

The much popular Common Wealth Games will come to an end in the India season on the 14th October.

The latest season of the CWG has seen participation from 71 nations and territories and while 12 day event was hit by missed construction deadlines, the collapse of a stadium footbridge and complaints of uninhabitable accommodation for athletes but it has been able to go at a smooth road so far.

The realty dilemma for RBI

The realty dilemma for RBI  Experts are of a view that the central bank of the country, The Reserve Bank of India (RBI) should give its decision of not granting licenses to players who have exposure to realty sector a second thought.

For the records, the central bank has passed on this information in the discussion paper which indicated that the groups that have exposure to the real estate sector may not be able to obtain the about to be issued banking licenses.

Bond yields down, but rate hike fears linger

Subir GokarnOn Wednesday Federal bond yields and trade relieved representing US Treasuries, but traders alleged that they could rise later in the day on apprehensions about a rate rise in November.

Subir Gokarn, a deputy governor at the Reserve Bank of India (RBI), said on Tuesday increase was well above the central bank's comfort zone. After this expectation for more monetary contraction was enthusiast.

Rural Banking Sectors Will Be Empowered and Upgraded

Rural Banking Sectors Will Be Empowered and UpgradedRBI has chalked out new plan to spoon feed rural banks which are spread in India. As per the directions given by Finance Ministry department, central government must play a major role to equate the status of dedicated rural banking sectors with commercial banks for doing better performance.

Current account deficit trebles to $13.7 bn in Q1

Current account deficit trebles to $13.7 bn in Q1 India’s present account deficit has tripled up to $13.7 billion in 3 months up to June this year. This had created a new record as the deficit last year during the same quarter was $4.5 billion.

The data from the Reserve Bank of India shows that the deficit has increased to more than the $13 billion which was reported earlier in March this year.

RBI warns banks on investing in zero coupon bonds

RBI warns banks on investing in zero coupon bondsThe Reserve Bank of India has warned the banks to put a conservative limit on their investment in zero coupon bonds which also include the non bank finance companies (NBFCs).

RBI has advised the banks to invest in zero coupon bonds only if the issuer builds up a sinking fund and invests in liquid investments or securities such as government bonds.

The investments in zero coupon bonds on a large scale could be a risk to the banks and it could harm the economy and banking operations of the country.

Illusion after the new Basel norms

Duvvuri SubbaraoThe Reserve Bank of India Governor Duvvuri Subbarao has recently said that the new global capital rules for the banking industry will be coming at an expense of the growth of the Indian market.

Subbarrao also said that the country needs to fund its $1 Trillion in infrastructure and bring more people in the financial sector of the economy. It is to be mentioned here that Subbarrao mentioned a rise in the Interest rates for the fifth time this year and is also facing a tough time in controlling the surging prices in the country.

Common man's say on the rate hike

Common man's say on the rate hikeWhile the central bank, Reserve Bank of India has recently announced a hike in the short-term borrowing rate (reverse repo) by 0.50 percent and lending rate (repo) by 0.25 percent in its quarterly review of the monetary policy, housing loan, auto loan, education loan are likely to move northwards from the next month.

It is to be mentioned here that repo rate is a rate at which the banks borrow funds from RBI and any increase in the same clearly means that borrowing will be more expensive.

Most of the Banks holding rates this month

RBIA day subsequent to assimilation of the mid-quarter monetary policy reassessment via Reserve Bank of India, most bankers expresses that they will grip their rates this month and reconsider the same in October, when festivals and the full of activity season fix in, providing a lucid design of the augmentation in credit demand.

According to K R Kamath, chairman and managing director of Punjab National Bank, there is an ascendant predisposition in interest rates and inflation is an apprehension, which the RBI has dealt with in the course of a rate trek.

Food inflation plunges up by 15.1% on supply constraints

Food inflation plunges up by 15.1% on supply constraintsFood inflation rose for the third week running as floods disrupted supplies, but most economists see food prices easing soon.

Inflation in food articles in the new series with 2004-05 base was 15.1% for the week finished September 4, contrasted with 14.6% in the week earlier than, data unconfined on Thursday depicted. The central bank decides to hoist rates in its policy appraisal on Thursday expressing that inflation is still a big distress.

RBI's announced hike more than expected

RBI's announced hike more than expected While the announcement made by the central bank i. e. the Reserve Bank of India was surely one of the announcements that were expected by the market experts and economists but as the reverse repo rate was hiked by 50 bps, the industry watchers are of a view that it was 25 bps more than what was initially expected by the markets.

For the record, RBI has recently announced a hike of close to 25 bps in the repo rates and close to 50 bps in the reverse repo rates.

RBI reference rates for US dollar and euro

RBI reference rates for US dollar and euroThe Reserve Bank of India (or RBI) made it known regarding its decision of fixing the reference rates for the US currency and European currency.

The RBI has fixed the exchange rate for the US Dollar as against the Indian Rupee at Rs. 46.93 for every 1 dollar, and the exchange rate for the euro as against the Indian rupee is at Rs. 59.35 for every 1 euro.

These rates are comparable with yesterday’s rates of Rs. 46.79 for every 1 dollar and Rs. 59.19 for every 1 euro respectively.

India's 10-year bonds drop as borrowing costs increases

India's 10-year bonds drop as borrowing costs increasesOn the news that the RBI will increase the borrowing costs, India's 10-year bonds dropped and simultaneously pushed up the yields to their highest level in three months.

On Tuesday, the RBI had said that it "may have to receive precedence over other policy objectives." After this, the bond yields climbed up by five basis points during this week, just before the government was to auction rupees 80 billion.

RBI reference rates for US dollar and euro

RBI reference rates for US dollar and euroThe apex bank of the country, Reserve Bank of India made known on Monday that is has fixed the reference rates for the US dollar at Rs. 46.61 a dollar and for the European currency euro it has fixed a reference rate of Rs. 59.28 for every euro. This is comparable to Rs. 46.58 for every dollar and Rs. 59.66 for every euro, as was the case on last Friday.

RBI may intervene to recast aviation sector’s debt

RBI may intervene to recast aviation sector’s debtThe Reserve Bank of India is bringing out a debt repayment program whereby the aviation industry which has been long suffering under financial stress will finally get to breathe.

The RBI mandate has been deemed necessary for the aviation sector to come out of its stress.

The State Bank of India has exposed Rs. 3,500 crore to the aviation department, which makes up for 0.24 percent of the total advances.




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