Skip to main content

RBI likely to hold rate next month

By
Monsoon uncertainty, increase in oil prices cloud inflation outlook
The Reserve Bank of India ( RBI) is expected to keep the interest rate unchanged on August 24, in its third bi- monthly monetary policy review for 2015- 16.
This was the near- unanimous response of 10 market participants in a poll conducted by Business
Standard. While nine of the respondents said they expected RBI to maintain the repo rate — the rate at which banks borrow from the central bank — at 7.25 per cent, only one said the rate could be reduced, by 25 basis points.
The market believes the outlook for inflation over the next few months depends on the monsoon rainfall during the rest of the season.
So, RBI Governor Raghuram Rajan might adopt a wait- andwatch approach for now. Besides, RBI had front- loaded the rate cut, with a 75- basis- point reduction since the start of 2015.
“Food prices remain at the mercy of exogenous events like rains.
As such, they also remain the biggest threat for RBI in its desire to lower inflation to four per cent by early- 2018,” said Pranjul Bhandari, chief India economist, HSBC Securities and Capital Markets ( India), in a note to clients.
India Meteorological Department (IMD) data show the monsoon this year ( June 1 to July 15) has so far been six per cent below normal across the country, despite good rains in June. And, there are areas that have so far got 20- 40 per cent less rainfall than normal. In these areas, if there is no strong pick- up, there are high chances of adrought.
Consumer Price Index ( CPI)based inflation rose to a ninemonth high of 5.4 per cent in June, mainly due to an increased rate of price rise in food items. RBI has set an inflation target of less than six per cent by January 2016 and four per cent (+/- 2 per cent) by the end of the two years starting 2016- 17.
Business Standard, New Delhi, 20th July 2015

Comments

Post a Comment

Popular posts from this blog

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the...
Post a Comment
Read more

SFBs should be vigilant, proactive to mitigate risks: RBI deputy guv

By
  The Reserve Bank of India’s Deputy Governor Swaminathan J on Friday instructed the directors of small finance banks (SFBs) to be vigilant and proactive in identifying emerging risks in the sector.Speaking at a conference for directors on the boards of SFBs, Swaminathan highlighted the role of governance in guiding SFBs towards sustainable growth with stability. He also emphasised the importance of sustainable business models.Additionally, he highlighted the need for strengthening cybersecurity to protect the entities against digital threats and urged for a stronger focus on financial inclusion, customer service, and grievance redressal to ensure a broader reach of banking services.Executive Directors S C Murmu, Rohit Jain, and R L K Rao, along with other senior officials representing the Supervision, Regulation, and Enforcement Departments of the RBI, also participated in the conference.   -  Business Standard  30 th  September, 2024
Post a Comment
Read more

Brigade Hotel Ventures files draft papers with Sebi for Rs 900 crore IPO

By
  Brigade Hotel Ventures Ltd, owner and developer of hotels in South India, has filed draft papers with capital markets regulator Sebi to raise Rs 900 crore through an initial public offering (IPO).The proposed IPO is entirely a fresh issue of equity shares with no Offer-for-Sale (OFS) component, according to the draft red herring prospectus (DRHP).Proceeds from the issue to the tune of Rs 481 crore will go towards payment of debt, Rs 412 crore will be allocated to the company and Rs 69 crore to its material subsidiary, SRP Prosperita Hotel Ventures Ltd.Additionally, Rs 107.52 crore will be used to purchase an undivided share of land from the Promoter, BEL, and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.The company may raise up to Rs 180 crore through a Pre-IPO Placement.   If the placement is undertaken, the issue size will be reduced.Brigade Hotel Ventures Ltd is a wholly-owned subsidiary of Brigade Enterprises ...
Post a Comment
Read more