US REVERSE REPOS
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.
Rupee bonds likely to outperform US and other developed markets
"Vis-a-vis, the rest of the world, the earlier story of a regular rupee depreciation will start to dissipate. While we are going to be a function of global markets, the rupee bonds will actually outperform the US and the rest of the developed markets," Ashhish Vaidya, head, treasury & markets, DBS Bank India, told ET.
RBI MPC Policy: Mutual fund managers decode RBI rate pause for investors
Reserve Bank of India in its bi-monthly monetary policy review again decided to keep the policy rate unchanged at 6.50%.
India can move in direction of providing guidance on liquidity, says MPC’s Ashima Goyal
Indian policymakers can follow the US Federal Reserve's guidance on liquidity conditions to mitigate market shocks, according to Ashima Goyal, a member of the Monetary Policy Committee. The US Fed Committee provides guidance on liquidity, which is crucial in many inflation targeting countries. India can also move in this direction as markets mature and deepen, making shocks less impactful.
Fixed deposit: Is it the last window to book FDs at high interest rates as RBI pauses repo rate?
Interest rate on fixed deposits have risen significantly however they are yet to match the rise in RBI repo rate hike of 2.5% seen since May 2022. May depositors were hoping that rate will rise further but hardly any bank has raised the rates significantly in last 1-2 months. However, tight liquidity in banking system and uncertainty about inflation movement may make a case for a higher rate on FDs. However, it may not be long lived and overall interest rate on FDs are likely to fall in coming months. What should depositors do?
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RBI MPC: Experts decode policy, spell-out their investment bets
While the policy was pretty much in line with the Street's expectations, here is how experts reacted to Governor Shaktikanta's monetary policy speech
Monetary Policy Committee decisions: Full view of what happened at RBI's August policy meeting
The six-member monetary policy committee voted unanimously to keep the key repo rate, the rate at which it lends to banks, unchanged at 6.5 percent and one member dissented on the monetary stance of focusing on withdrawal of accommodation.
India swap rates hint Street does not expect rate cuts till Aug 2024
Overnight indexed swap (OIS) rates, the principal tool for hedging interest rate risk in India, have climbed sharply since the RBI's last policy in June and now suggest that the central bank would only lower the repo rate in August of next year as against the earlier pricing that pointed towards policy easing at the beginning of the next fiscal year.
FD interest rates peak: Which is the best tenure for fixed deposit to book now after RBI holds repo rate
RBI keeps repo rate unchanged in the second consecutive monetary policy this year which signals that the interest rates have reached almost the peak of current cycle. The possibility of a rate cut in coming months is becoming stronger. While short to medium rates have risen early the long term FD rates are yet to get full benefit of repo rate hikes. So what should you do with your FDs now?
MPC: RBI keeps interest rates unchanged for second time in a row, lowers inflation forecast
The Reserve Bank of India has left interest rates unchanged for the second consecutive monetary review meeting, suggesting it is in no rush to address the cost of funds as the inflation trajectory is sliding, with lower inflation forecast for the fiscal year. The central bank cited adequate supplies and an unlikely demand push as tepid global growth boosted expectations of further easing in commodity prices.
After RBI's pause, industry wants reversal of rate hike cycle
President of industry body Ficci Subhrakant Panda said a status quo in policy rates was largely expected and, by keeping the repo rate unchanged and maintaining the stance of withdrawal of accommodation, RBI is keeping a watchful eye on inflation while supporting growth.
SGX Nifty down 30 points; here's what changed for market while you were sleeping
Nifty futures on the Singapore Exchange traded 28.5 points, or 0.15 per cent, lower at 18,724, signaling that Dalal Street was headed for a negative start on Wednesday.
Record US reverse repos highlight problem of investing excess cash
The Fed's reverse repo window attracted a record $2.045 trillion on Monday, as financial institutions continued to flood the facility with liquidity in exchange for Treasury collateral.
Debt mutual fund managers react to RBI’s status quo on rates
In line with market expectations, the RBI has maintained a status quo on policy rates and has also decided to maintain an accommodative stance on rates. Here’s what top debt fund managers had to say about the policy:
Expect RBI to hike reverse repo by 15 bps this time, says CLSA’s Indranil Sengupta
“We do expect the RBI to hike the reverse repo rate by 15 bps this time and by 100 bps over the entire fiscal and 50 bps next fiscal. So all in all, 150 bps of rate hikes based on more than 200 bps of hikes by the Fed as well as relatively high inflation.”
Not raising reverse repo rate could make the benchmark ‘irrelevant’: Prof JR Varma
If the central bank is embarking on the path of rate tightening and liquidity normalization, it should ‘say it openly’ instead of holding the reverse repo rate, says Varma.
RBI keeps rates unchanged; FY23 GDP growth seen at 7.8%. Here are the top takeaways
The MPC has, unanimously, opted to maintain the repo rate at 4.00%. With a 5:1 majority, the committee also opted to maintain an accommodative stance in order to support economic growth and recovery, the Reserve Bank of India (RBI) Governor Shaktikanta Das said on Thursday.
Sensex surges 500 points as RBI holds rates; maintains accommodative stance
The Reserve Bank on Thursday decided to keep the repo and the reverse repo rate unchanged at 4 per cent and 3.35 per cent, respectively
RBI Policy Review: Inflation may take spotlight, but growth war still on
An ET poll comprising 22 respondents predicts that at its three day policy review ending Thursday, the RBI’s Monetary Policy Committee will raise the reverse repo rate, which for long has dictated the overnight cost of funds for banks
RBI may raise reverse repo rates
As the recent surge in Omicorn variant has failed to derail the momentum in the economy in a big way, growth may not be as much of a concern, rising rates in the overnight call money rates, the case for a rate hike becomes stronger
10-year bond yield remains flat, but traders expect a spike soon
The US Federal Reserve's hawkish commentary and a roadmap for rate hikes next year have turned the local market's attention to action from the Reserve Bank of India (RBI). Though the benchmark bond yield did not move much on Thursday, dealers said higher international rates, local inflation and the central bank's move away from the benchmark reverse repo rates will take yields higher.
Inflation trends made a case for a reverse repo hike
The RBI's latest Monetary Policy Committee meeting was set in the backdrop of an inflexion point in the global monetary policy cycle. More and more central banks have begun either the tapering of the stimulus or talking hawkish and/or raising rates.
Will RBI really raise reverse repo rate as the market is expecting?
The amount of the GSAP for Q3 could be reduced with the provision that it could be revised up when required. Moreover, the RBI could continue to sterilise its GSAP purchases going forward to keep the impact of its yield management tools liquidity neutral.
Higher-than-expected cutoff at RBI reverse repo, US developments bring hawks swooping back to mkts
Benchmark equity indices shed more than 1 per cent on Tuesday, the rupee closed at a one-month low, while yield on the 10-year benchmark government bond climbed 2 basis points. Bond prices and yields move inversely.
Benchmark bond yield up with oil, US yields
North Block's circumspect borrowing target for the second half of this fiscal failed to lift Indian bonds on Tuesday amid a palpable global threat of higher fuel prices, and signals from the central bank on baby steps to normalisation of liquidity potentially lifting overall rates marginally.
Yields rise before Fed meeting statement, retail sales disappoint
The Fed is not expected to announce any plans to pare its bond purchases until its August Jackson Hole economic symposium, though it may indicate that it has begun discussions about when to taper.
What's at stake for markets as US debt ceiling looms
When the ceiling is reached, the Treasury cannot issue any more bills, bonds, or notes. It can only pay bills through tax revenues.
What's at stake for markets as debt ceiling looms
The debt ceiling is the maximum amount the US government can borrow, as directed by Congress, to meet its financial obligations. When the ceiling is reached, the Treasury cannot issue any more bills, bonds, or notes. It can only pay bills through tax revenues.
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