REVERSE REPO RATE UNCHANGED
Central spending gives a boost to liquidity, brings overnight rate 10 bps below repo
Following recent elections, increased government spending has injected liquidity into India's banking system, resulting in lower overnight borrowing rates, Treasury Bill yields, and short-term financing costs for Indian companies. Despite these developments, the Reserve Bank of India (RBI) appears cautious about reducing policy rates. The overnight weighted average call rate (WACR), which hovered above the RBI's repo rate of 6.50% in May and June, has averaged 6.39% in July, indicating a surplus liquidity situation.
Why does China's central bank have a new cash management tool?
China's central bank unveiled a new cash management tool through temporary bond repo agreements and reverse repos, expanding its monetary policy framework. Market participants see these as crucial steps by the People's Bank of China (PBOC). The move aims to establish a new interest rate benchmark and manage risks amid a bond rally and yuan weakness.
Incomplete transmission could delay rate reversal by RBI
High food inflation and incomplete transmission of the 250 basis point policy rate hikes since May 2022 could delay the Reserve Bank of India's (RBI) rate cut. Transmission through loan and deposit rates varied between 111 and 245 bps until May 2024, except for loans linked to external benchmarks, which had immediate full transmission.
Incomplete transmission of policy rates could delay reversal of rate cycle by RBI
RBI faces challenges in rate transmission due to incomplete hikes. Banks show varied transmission rates. Governor Das stresses effective transmission. Rate cuts may come post-October with clearer risk insights.
We are actually raising the real repo rate: MPC's Jayanth Varma
Jayanth Varma, who has expressed concerns about growth sacrifice due to restrictive monetary policy, voted for a 25-basis-point rate cut in the MPC's June policy review.
Real repo rate too high and could hurt growth, said MPC dissenters
The two external members of the Reserve Bank of India (RBI) Monetary Policy Committee (MPC) who had pushed for a 25 basis point rate cut at the June 7 meeting, Ashima Goyal and JR Varma, said the real repo rate at 2% was too high and could hurt growth, according to the minutes released by the central bank on Friday.
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Banking return on assets to dip 10-20 bps: Crisil
Return on assets (RoA) of banks, after hitting a 20-year high in the previous year, is forecasted to ease to 1.1-1.2% in the current fiscal year, according to Crisil Ratings. The moderation is attributed to higher deposit costs impacting net interest margins. Credit costs are expected to stabilize, supporting overall profitability as non-performing assets decrease.
Expect repo rate cut only in October RBI policy meeting: SBI Research
The report, authored by Soumya Kanti Ghosh, SBI's Group Chief Economic Adviser, expects first repo rate cut in October meeting. The repo rate is the rate of interest at which the RBI lends to other banks.
Upward GDP projection and no change in interest rates welcomed by industry and economists
Industry leaders and economists widely accepted RBI's monetary policy stand of no change in interest rates. Besides upward projection of GDP growth for FY25 from 7 per cent to 7.2 per cent is welcomed by the Industry.
Sensex hits fresh all-time high, surges 1,619 points; rate-sensitive stocks surge up to 9% post RBI policy decision
The market capitalisation of all listed companies on BSE surged by Rs 7.38 lakh crore to Rs 423.27 lakh crore. Post RBI policy decision, realty indices surged up to 9.5%, with Sunteck Realty, Sobha, Brigade, and Lodha rising between 3% and 9.5%. Nifty Bank stocks such as Bandhan Bank, SBI, Axis Bank, AU Small Finance Bank, and Kotak Bank rose by 1-2%.
Builders want reduction in repo rate in RBI's next monetary policy to boost housing sales
Real estate developers urged the RBI to lower the repo rate in the upcoming monetary policy to reduce home loan interest rates and stimulate housing demand, as the RBI maintained the rate at 6.50%. Industry experts anticipate potential rate cuts in the future to boost the real estate sector further amid strong market performance.
High FD interest rates may not last long despite RBI status quo; is this the last window to book fixed deposits at higher rates?
FD Interest Rates: RBI in its MPC meeting on June 7 kept the repo rate unchanged at 6.5%. This marks the eighth consecutive MPC with status quo, benefiting fixed deposit investors with high rates. However, going forward the interest rate cycle to reverse. The potential for a rate cut later in the year is anticipated.
Home loan borrowers may have to wait longer for lower EMIs but a rate cut likely this year; how to make the most of it
Home Loan Interest Rates: The Reserve Bank of India (RBI) in its recent Monetary Policy Committee meeting decided to maintain the repo rate at 6.5%, prolonging the wait for home loan borrowers seeking relief from high interest rates and increased EMIs. Despite the current pause in repo rate the possibility of a rate reduction this year is still there.
RBI MPC retains repo rate at 6.5 per cent for 8th time in a row; GDP forecast hiked, inflation unchanged
RBI MPC Meet 2024: The Reserve Bank of India, under the guidance of the Monetary Policy Committee (MPC), maintained the repo rate at 6.5 per cent for the eighth consecutive time. The announcement was made by RBI governor Shaktikanta Das following the conclusion of a three-day meeting that began on June 5.
RBI MPC Meeting 2024 at a glance: Here's a one-stop guide to all key decisions
The Reserve Bank of India's Monetary Policy Committee (MPC) has decided to maintain the current interest rate at 6.5%, following a 4:2 majority decision. The panel projected real GDP growth for FY25 to be 7.2%, up from 7%. The MPC is also maintaining the Standing Deposit Facility rate at 6.25% and the Marginal Standing Facility bank rate at 6.75%.
RBI MPC Meet 2024: RBI leaves inflation projection for FY25 unchanged at 4.5%
RBI MPC Meet 2024 LIVE: The Reserve Bank of India maintained its inflation forecast at 4.5% for this fiscal year amid concerns over rising food prices. The central bank found some relief as crude prices dipped below $80 per barrel. The RBI's Monetary Policy Committee kept the repo rate unchanged at 6.5% for the eighth consecutive time, citing vigilance against potential inflationary pressures. Governor Shaktikanta Das highlighted the uptick in vegetable prices and global food inflation. Despite a slight easing in overall retail inflation to 4.83%, concerns linger over food price hikes, particularly in items like garlic and ginger.
RBI MPC Meeting: Das & Co may look at food bills to keep its stance, rate unchanged
RBI Policy Meeting: The Reserve Bank of India (RBI) is expected to maintain the repo rate at 6.5% with a focus on withdrawing accommodation, marking the eighth consecutive time it remains unchanged. Economists predict the unchanged stance, citing persistent inflation in food prices and global commodity price risks. RBI Governor's decision is crucial post-elections.
RBI leaves inflation projection for FY25 unchanged at 4.5% as 'elephant' out for a walk
Reserve Bank of India Monetary Policy: The RBI today left inflation estimate for fiscal 2025 unchanged at 4.5% amid rising concerns over soaring crude oil prices and supply chain disruptions due to the Red Sea crisis. Food inflation remains a concern after it climbed to 8.7% in February, driving overall inflation, while Brent and WTI futures have now surged on geopolitical tensions.
'Acche din' to continue for FD investors as high fixed deposit interest rates will not drop soon: All eyes on RBI MPC on June 7
The Reserve Bank of India (RBI) will likely keep the repo rate unchanged in the upcoming monetary policy committee review. The question now is how long will the high-FD rate regime continue. Also, what should be the best strategy for your short-term and long-term fixed deposits? ET Wealth Online spoke to experts and here's all you need to know.
RBI unlikely to cut interest rate on June 7, say experts
The Reserve Bank of India is unlikely to cut the benchmark interest rate in its upcoming monetary policy review amid inflation challenges and improving economic growth. Scheduled for June 5-7, the Monetary Policy Committee (MPC) is expected to maintain the current 6.5% repo rate. Experts cite steady economic conditions and ongoing inflation concerns as reasons for maintaining the status quo
RBI likely to leave rates unchanged in FY25, help maintain India's 'Goldilocks' environment: Morgan Stanley
Economists anticipate the Reserve Bank of India (RBI) to maintain its policy rate at 6.5% for the fiscal year 2024-25 due to factors like higher-than-targeted inflation, global influences such as commodity prices, and a stronger dollar. The RBI's decision will also hinge on domestic factors like growth driven by capital expenditure (capex) and productivity.
Realty stocks jump over 7% after RBI MPC leaves repo rate unchanged
The policy was a non-event for other rate-sensitive sectors like banks and auto. Nifty Bank was up by 0.40% at 48,242,on account of gains in HDFC Bank.
RBI leaves repo rate unchanged; retains “withdrawal of accommodation” stance
RBI maintains 6.50% repo rate after 3-day meeting, focusing on withdrawing accommodation. Supported by 5 of 6 MPC members. Minimal market impact on Sensex, Nifty 50.
RBI MPC keeps repo rate unchanged at 6.5 per cent for the 7th time in a row; GDP, inflation forecast retained
The RBI-led MPC kept the repo rate steady at 6.5 per cent for the seventh time, confirmed RBI governor Shaktikanta Das. The committee also maintained its 'withdrawal of accommodation' stance while concentrating on liquidity management to control inflation.
ET Explainer: The RBI's liquidity stance and its effect
The Reserve Bank of India's liquidity stance is not convincing experts. It follows a corridor liquidity management system with repo rate as the ceiling and reverse repo rate as the floor. Factors causing tight liquidity include withdrawal of accommodative stance, credit growth surpassing deposit growth, fund constraints, slower government spending, and Ukraine war impacting forex reserves.
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