RBI panel calls for greater FII play in G-Secs

The group, headed by the Executive Director of RBI, R Gandhi, has said the government and regulators could raise the investment limits for foreign portfolio investors, or FIIs, in phases. "FIIs, by being global players, can provide the much-needed diversity of views in the market, thereby providing more opportunities for trading," the draft report on enhancing liquidity in G-Secs and interest rate derivatives markets said. The group has also called for participation by overseas portfolio investors in the interest rate derivate market............ 

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New security system at RBI

.....“The material for the boom barriers is designed in full core steel, ensuring maximum safety against corrosion. It is being installed at the entry point of RBI. The barrier is normally closed and opened only when bank vehicles enter," a top source in RBI said. The bank already has security measures like perimeter wall intrusion alert system and security officials. The bank General Manager, Mr C.V.George, had also sought the assistance of the local police in beefing up the security...........

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Little Impact on Banking Due to Strike

....As per the data available with the Reserve Bank, there was only a marginal drop of 3 per cent in the clearing transactions today. "While on a normal day, the value of clearing transactions is around Rs 10,000 crore, it was Rs 9,700 crore today showing a marginal drop," a RBI official said......

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Rural banking cannot be overlooked: Tingalaya

....Mr C Sambasiva Reddy, Chairman of KVG Bank, said the bank has adopted a clear-cut roadmap under various parameters as directed by the Union government, Reserve Bank of India and Syndicate Bank. The bank plans more grama sabhas to reach out to the farming community with simple credit products to even remote villages....

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Subbarao’s job just got harder – thanks to Q4 GDP crash

It is true that the Reserve Bank of India (RBI) has to address the GDP growth fall but it will have to be allowed to do so in a manner that is not disruptive. The sharp fall in fourth quarter GDP growth to 5.3 percent against market expectations of 6.1 percent places an additional burden on the RBI Governor D Subbarao. The central bank is fighting inflation, the rupee’s fall, liquidity and government borrowing. The below-trend GDP growth has all and sundry clamouring for the RBI to ease monetary policy. The fact is that the RBI cannot just focus on easing policy to raise GDP growth expectations. Every action of the RBI will have an effect on one macro factor or the other and the RBI has to do a fine balancing act. Hence it is advisable to stay off RBI and let its do its job.....................

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RBI draft report says need to raise FII invest limit in bonds

.....The RBI’s working group released its draft report on Thursday outlining measures to boost liquidity in government securities and interest rate derivatives market........

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Captivating synchrony

.............A. Boothalingam, retired GM and Deputy Controller, RBI, is a musician in his own right. Having learnt Carnatic music from stalwarts such as Kittamani Bhagavathar, D.K. Jayaraman and K.V. Narayanaswamy, Boothalingam has given music performances in sub-senior slots during the December Season..........................

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Growth dives, govt in denial mode

........."It will inevitably send shivers down the spines of senior coalition politicians, who will no doubt be heaping pressure on the Reserve Bank to react and react aggressively," ...................

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India's woes are homegrown

....A better approach than leaning on the RBI would be for New Delhi to enact progressive policies to support investment. Politics will make that difficult, though, and India's economic parameters could get worse. New Delhi could find this difficult cycle is very hard to break.

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Growth at 5.3%: Time for RBI to rework its priorities

......However, with the latest growth figures of below the psychologically important 6 percent mark, RBI will doubtless have to go back to the drawing board ahead of its June 18 policy review. Economists reckon that with this inordinate slowing down of the growth rate, core inflation would also be coming down, and it was therefore necessary for the central bank to rework its growth-inflation priorities and place growth above inflation in its list of concerns........

........The spotlight, once again, will be on Subbarao and RBI. How the RBI Governor assesses the situation and whether he reworks his growth-inflation priorities will hold the key in the coming days. A growth figure which is the lowest in nine years surely deserves attention.

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India's shocking GDP: What are RBI's options now on June18?

..........Sujan Hajra, Chief Economist, Anand Rathi Securities is not convinced that a mere rate cut will make any difference in the tight liquidity situation. He stresses that for transmission of loose monetary policy, the system needs liquidity surplus. "So, CRR cut, OMO or perhaps a combination of both may give the push. I personally expect about Rs 2 lakh crore of OMO and Rs 1 lakh crore of CRR cut, that’s 1.5% and RBI infusing Rs 3 lakh crore of liquidity in the system.”

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India’s ‘shocking’ GDP growth may send shivers to coalition politicians

Credit Suisse, in its hard hitting analysis says that India’s GDP growth for the March quarter is much below expectations and coalition politicians may put more pressure on the RBI for easing rates.......

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CII demands immediate economic revival package

...........CII said that their primary demand is that RBI should cut repo rate and cash reserve ratio (CRR) by at least 100 basis points, which would make borrowings cheaper besides boosting sentiment.................

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India now a 'gasping elephant'!

......"... traction on deep rooted structural reforms is needed to significantly improve the inflation-growth trade-off in the short as well as medium term," HSBC Chief Economist for India & ASEAN Leif Lybecker Eskesen said, adding that the RBI will have to approach any further easing with "caution".

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Rupee decline, wobbly markets and 'lowest' GDP growth highlight inept handling of economy by UPA-II government

....Senior policymakers appeared to be pinning their hopes on the RBI cutting rates. "It is critical to appreciate that there is no scope for any further fiscal stimulus, but if inflation moderates, then RBI has a greater room to exercise its power," C Rangarajan, chairman of Prime Minister's Economic Advisory Council told ET...................

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Rupee fall: Did RBI ask PSU banks not to purchase dollars?

The rupee spiked, breaching 56 to the dollar, on market chatter that the RBI has asked state oil companies to restrict purchases of dollars through four state-run banks, but senior officials from the RBI and oil firms said the talk was not true. A senior official at the Reserve Bank of India called the rumours “preposterous” and said he was not aware of any such directive being issued...........

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