RBI CAUTION
India's weekly vegetable spending up in the past few weeks, says survey
Rising vegetable prices due to various factors like the heatwave and monsoon challenges have led to increased consumer spending. Authorities are urged to step in to address the situation and stabilize prices for households across the country.
RBI cautions against surge in private credit between corporates and non-banks
The Reserve Bank of India (RBI) warns of systemic risks from the rapid growth of private credit, which has quadrupled in the past decade, especially due to its opacity and interconnectedness with banks and non-banks. The RBI highlights potential vulnerabilities in this segment, including the risk of sharp losses during a credit cycle downturn and challenges posed by complex structures and liquidity risks.
Fintech lenders have high delinquency levels in small value loans says RBI
The RBI has highlighted concerns over consumer loans, noting that over half of borrowers have three or more loans simultaneously. The Financial Stability Report flags high delinquency rates, especially among personal loans under ₹50,000 and loans from fintech lenders. Despite overall improvements in credit quality, stress in retail loans remains significant, particularly for private sector banks.
ETtech Deep Dive: How RBI and NPCI are working to tackle mule account frauds
The RBI, the National Payments Corporation of India, and the Ministry of Home Affairs are teaming up with banks, financial institutions, and tech security companies to crack down on mule accounts and prevent fraud in the country's banking system.
India central bank policymakers divided over rate-growth debate
Internal members maintain hawkish stance on inflation, with Governor Das cautioning against hasty actions for fear of worsening the situation
Time to reset the 4% inflation target?
A scenario where real wages rise slowly may mitigate the impact of inflation surpassing its target on economic growth. Sustaining an 8% growth rate will require a resurgence in both consumption and investment. Any decline in consumption could adversely affect investment, prompting the RBI to exercise caution in reducing interest rates until inflation aligns with or falls below the target. If the economy can maintain higher growth rates at lower inflation levels, there may be a need to reconsider the inflation target. Structural shifts in the economy indicate that achieving this goal is increasingly feasible in the near future.
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Former RBI Governor Raghuram Rajan warns against fake videos of him recommending stocks
Former Reserve Bank of India (RBI) Governor Raghuram Rajan has cautioned investors against fake videos of him circulating on social media, giving investment tips, especially on individual stocks.
Why are milk, vegetable, and pulse prices rising? When will they come down? Here are some indicators
Food inflation in India has persisted at 8% year-on-year since November 2023. A severe heatwave has further reduced supplies of pulses, vegetables, and cereals, prompting minimal impact from export curbs and import tariff reductions. Experts suggest that a robust monsoon by early July could alleviate concerns over the delayed cultivation of kharif crops.
RBI flags pursuit of growth at cost of risk buildup
India's banking regulator cautioned lenders against pursuing 'mindless' business growth to avoid exposing the financial system to risks. RBI Governor Shaktikanta Das emphasized the importance of balancing business growth with risk management.
RBI's timely action reduced vulnerabilities in unsecured loans: Shaktikanta Das
The Reserve Bank of India (RBI) Governor Shaktikanta Das announced on Thursday that timely actions by the central bank have helped in moderating vulnerabilities related to unsecured loans. This statement was made during the Second Global Conference on Financial Resilience organized by the College of Supervisors.
Retail investors play with a time bomb but RBI and Sebi are watching
Futures and options (F&O) trading involves contracts that derive their value from an underlying asset, such as stocks and commodities. Futures contracts obligate the buyer and seller to transact at a predetermined future date and price, while options give the holder the right, but not the obligation, to buy or sell the asset at a set price within a specific period.
Fitch raises FY25 India GDP growth forecast to 7.2 per cent
In its Global Economic Outlook (GEO) released Monday, it raised its forecast for world growth in 2024 to 2.6% from 2.4% estimated earlier. India's economy grew 8.2% in FY24. "We expect the Indian economy to expand by a strong 7.2% in FY25 (an upward revision of 0.2pp from the March GEO)," Fitch Ratings said, adding that investment will continue to rise but more slowly than in recent quarters, while consumer spending will recover with elevated consumer confidence. Purchasing managers survey data point to continued growth at the start of the current financial year.
Rupee closes at record low vs dollar ahead of US Fed statement
Recently released data showing a larger-than-expected jobs addition in the US has dampened hopes of the Federal Reserve lowering interest rates while sharp weakness in the Chinese yuan versus the US dollar over the past couple of days has dragged Asian currencies lower, dealers said.
Banks ask RBI to ease liquidity rule to keep credit taps open
Indian banks are urging the industry regulator to relax the current liquidity coverage requirements. They believe easing these mandates will free up more funds for lending.
Tech-based NBFCs try a balancing act after RBI action on unsecured loans
NBFCs like DMI Finance, Vivriti Capital and InCred Capital expanded unsecured retail and small business lending, leveraging strong fintech partnerships over to grow their business coming out of Covid. Some of these companies took the acquisition route to scale up this business quickly.
RBI cautions micro finance lenders against usurious interest rates
The Reserve Bank of India (RBI) has warned lenders, particularly in the microfinance sector, against charging "usurious" interest rates by exploiting the regulator's freedom. While most lenders follow guidelines on the Key Facts Statement (KFS), some continue to impose undisclosed fees and high interest rates, particularly on small-value loans provided by microfinance institutions (MFIs) and non-banking financial companies (NBFCs).
RBI MPC meeting: India’s FY25 GDP forecast raised to 7.2% from 7%
The Reserve Bank of India (RBI) raised the FY25 real GDP growth forecast to 7.2% from 7% due to improved rural and urban demand, bolstered by monsoon predictions. The Monetary Policy Committee kept the benchmark rate at 6.25%, noting domestic economic resilience. India's FY24 GDP growth accelerated to 8.2%, driven by a sharp decline in the GDP deflator.
R Gandhi welcomes RBI's focus on banking safety and payment system soundness
RBI has been paying more attention on that in recent months, especially the disclosure, relating to the terms and conditions of the most important terms and conditions of the credit that is being offered by the credit institutions and there that is the first step which had already been taken.
India's growth outlook: Economy to get a blockbuster release this Friday? But that's too late to stream in poll campaigns
GDP Q4: As the country buzzes with election excitement, India is set to release its GDP growth numbers for the fourth quarter of FY24 this Friday, alongside the full fiscal year figures. Analysts are eagerly awaiting to see if the January to March quarter numbers surpass expectations, fueling hopes of a surprising uptick in growth.
RBI's record dividend invites mixed reactions from economists
The Reserve Bank of India's (RBI) decision to declare its highest-ever dividend of Rs 2.11 lakh crore has sparked mixed reactions from economists. Noted economist Suman Mukherjee views it as a sign of economic strength, attributing the windfall to various factors such as a surge in foreign exchange reserves and proactive government management. Mukherjee believes that maintaining low interest rates will counter potential recessionary effects.
RBI's Swaminathan cautions NBFCs on poor data, unsecured loans
"While automation can enhance efficiency and scalability, NBFCs should not allow themselves to be blinded by these models. It is crucial to recognise that rule-based credit engines are only as effective as the data and criteria upon which they are built. Over-reliance on historical data or algorithms may lead to oversights or inaccuracies in credit assessment, particularly in dynamic or evolving market conditions," Swaminathan said.
RBI cautions banks on gold loan disbursals through fintech startups
RBI cautions banks on gold loan disbursement concerns through fintechs like Rupeek, IndiaGold, and Oro Money. Banks evaluating next steps post IIFL Finance issue. Asset quality improved at Rupeek, with partnerships with Federal Bank, Indian Bank, and South Indian Bank.
RBI urges banks for caution on unauthorised forex transactions
The central bank said in a notification on Wednesday that it has come across instances of unauthorised entities offering foreign exchange trading facilities to individuals with promises of disproportionate and exorbitant returns.
ETMarkets Smart Talk: Nimesh Chandan on markets, dividend-paying stocks & why investors should exercise caution in SME space
Nimesh Chandan, CIO of Bajaj Finserv AMC, advises focusing on companies trading below their intrinsic value. He believes that India is outperforming developed and emerging markets and expects fixed-income markets to generate good returns. Chandan also sees potential in the tourism sector and warns investors to be cautious about SME IPOs.
RBI cautions banks, NBFCs against complancency
Reserve Bank of India (RBI) governor Shaktikanta Das has asked banks to be on guard against complacency and be vigilent around build-up of risks in the financial sector. Das along with deputy governors M Rajeshwar Rao and Swaminathan J met CEOs of public sector banks on Tuesday, the first such meeting since July last year.
Do not share documents with unknown entities for KYC updation, cautions RBI
On what should be done in the event of receiving any request for KYC updation, RBI said directly contact their bank/financial institution for confirmation/ assistance."Obtain contact number/ customer care phone number of the bank/ financial institution only through its official website/ sources," the central bank said.
Hope and caution: Key takeaways on India's economy from IMF and RBI
Two recent reports about India's economy show its strength but also warn about challenges ahead. The International Monetary Fund (IMF) praised India's growth and financial progress. The Reserve Bank of India (RBI) highlighted good growth but cautioned about inflation and potential risks to future progress.
RBI cautions against unauthorised loan waiver campaigns
The Reserve Bank of India (RBI) has issued a caution against misleading ads offering loan waivers, noting entities charging fees for unauthorised 'debt waiver certificates.' Some campaigns advise against paying bank dues, undermining regular repayment practices. RBI warns borrowers, emphasising that such activities harm financial stability and may lead to direct financial losses.
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