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Saturday, August 31, 2013
Five years of leading the Reserve Bank - Looking ahead by looking back: D Subbarao
Reading Subbarao right
...........But never so publicly! Or so bluntly! Though the RBI reports and policy statements are public documents, few care to read them. Most people, including many commentators content themselves with focusing on the interest rate and other policy changes. As a result when the governor raised issues of central bank autonomy, better co-ordination between fiscal and monetary policy and bemoaned the government’s failure to utilize the window of opportunity created by the period of abundant global liquidity, to mention just a few, it was seen as a frontal attack on the government...............
Read..........
3 pols x 3 wonks= ?
..................D Subbarao responded later to the criticisms about his record as central bank governor. He was man enough to admit that he may have got it wrong on monetary policy, but he also gave a parting shot to the government and specifically the finance minister. But surely, Dr Subbarao cannot pass the buck entirely; he has to bear some of the responsibility for allowing the rupee to stay too long at a level that priced out exports and caused the gaping current account deficit for which he blames the government.........
The slowdown far exceeded anything that could be attributed to a tight monetary policy: Subir Gokarn
Subbarao pushes case for Producer Price Index to gauge price momentum
...........“As far as inflation measures go, the problem in India is not of deficit, but of excess. Ours is a tale of many indices,” said Dr. Subbarao, while speaking on ‘RBI’s Policy Making Conceptual and Empirical Issues’, at the 7th Statistics Day conference of RBI here........
RBI says role of statistics has increased manifold
New CPI narrow for monetary policy decisions: Subbarao
........Posing the question if there is a case for shifting focus to the CPI, Dr. Subbarao said even in case of such an eventuality, the central bank will not abandon the wholesale price index (WPI) as a tool to monitor producer prices. “My own view is we will not, because analytically we need to develop a series of producer price indices that will help us gauge how price momentum builds up in the economy.”...........
Statistics in RBI’s Policy Making Conceptual and Empirical Issues
Inaugural address by Dr. Duvvuri Subbarao, Governor, Reserve Bank of India at the 7th Statistics Day Conference of RBI, Mumbai on August 30, 2013
...The second conceptual challenge I want to address relates to the measurement of two important macroeconomic variables in the context of monetary policy: potential output and threshold inflation. Understanding the divergence of actual output and inflation from potential output and threshold inflation respectively is critical for the formulation of monetary policy. Reliable estimates of these variables are necessary for formulating the central bank reaction function in the form of Taylor type rules for setting interest rates..........
RBI sees need to develop database for housing finance
Need efficient bankruptcy law in corporate bond market - R.Gandhi
How Canara Bank victimised borrower of an education loan
......This looks like a clear case of error on part of the Bank official/s that sanctioned the education loan or Rs15 lakh without knowing if there could be any ceiling limit. If Parag was told of this limit at the outset, he would have arranged for the shortfall from other sources. But as a result of this mistake, he was being penalised and forced to pay excess interest at the rate of 5% on outstanding amount of over Rs10 lakh. All this while, he was paying regularly his equated monthly instalments (EMIs) without any delays or disruption.............
A bid to improve the image
Nani Palkhiwala Memorial lecture will be remembered in Indian financial sector, not much for the highlights like the ‘joke’ on P Chidambaram about the FM’s monologue about ‘walking alone’, which were given wide coverage by the media, but for its content on the relevance of RBI in the present Indian context. This speech may put a lid on any chance of Dr Subbarao shifting to Delhi or getting nominated to International Organisations like some of his predecessors. But, the task which Dr Subbarao took upon himself, namely, putting forth a strong defence for whatever has been done by RBI during his tenure and setting an agenda for his successor, will improve the image of the central bank which has been made a whipping boy by self-styled analysts and certain hostile individuals in the Finance Ministry.
- M.G.Warrier
We feel neglected
My View on "Introspection on pension updation - P. R. R. NAYAR...":
P R R Nayar’s letter reflects the emotions of many retirees who feel neglected by the institution. The previous letter addressed to Governor on the subject had given the entire ..........
P R R Nayar’s letter reflects the emotions of many retirees who feel neglected by the institution. The previous letter addressed to Governor on the subject had given the entire ..........
RBI Governor opens his mind - Dr.T.V.Gopalakrishnan
......... Former CAG Mr Vinod Rai and the Governor Dr Subbarao have created a new history and shown to the world as to how the Public Institutions should be run and deliver the goods expected of them as per the laws of the land. This is the real strength of the economy.
PM opens race for SBI top job to four managing directors
.......Given the earlier requirement of at least two years of remaining service to be considered for chairman's post, only Arundhati Bhattacharya was eligible for the top job at the country's largest bank. To widen the field, the finance ministry sought an exemption for A Krishna Kumar, another SBI MD. The move comes at a time when the government has decided to give a fixed three-year term to the next SBI chairman, who will take over from Pratip Chaudhuri, who retires in a little over a month............
Chavan to meet RBI governor designate on Sept 6
Maharashtra Chief Minister Prithviraj Chavan will meet the Reserve Bank of India (RBI) Governor designate Raghuram Rajan on September 6 after he takes charge of the office. "I will discuss issues relating to rupee volatility with new Governor." Chavan announced his proposed meeting with Rajan during his interactive meeting with Ficci national executive committee members here today............
'15,653 complaints against pvt banks for excess levy of fees'
.......The Minister said that a number of steps have been taken by the government as well as the RBI to resolve the complaints of customers, expeditiously, including those on excess charges. "In order to improve customer service in banks, majority of recommendations of the Damodaran Committee have been implemented by the banks. A working group has also been constituted by the RBI to review and update the Banking Ombudsman scheme,"..........
RBI quiz competitions
The zonal finals of the inter-school quiz competitions organised by the Reserve Bank of India (RBI) will be held in Mumbai. Earlier, competitions for students of class 9, 10, 11 and 12 were held on August 27 at the Centre for Economic and Social Studies (CESS), Begumpet. .............
Central Bank of India Executive Director receives ` RBI Rajbhasha Shield’
Central Bank of India Executive Director Animesh Chouhan receiving RBI Rajbhasha Certificate from Reserve Bank of India Governor Dr D Subbarao, flanked by Dr Urjit R. Patel, Dy Governor of RBI, R Gandhi, ED of RBI, Narendra Singh, GM (Rajbhasha), Dr Usha Gupta, Asstt GM (Rajbhasha), B Subbarao, Asstt. GM, Mahesh Mishra, Senior Manager (Rajbhasha) and Hitendra Dhumal, Manager ( Rajbhasha). Central Bank of India had been awarded the second prize in linguistic region ‘ C’ and third prize in linguistic region ‘ A’ by RBI for the best implementation of Official Language Policy of Govt of India for 2011- 12 in Mumbai.
Don't donate to trusts where directors hold post: RBI to UCBs
..........."...UCBs are, with immediate effect, prohibited from giving donations to Trusts and Institutions, where directors, and/or their relatives hold position or are interested, even within the permissible ceiling of 1% of the published profits of the bank for the previous year," RBI said in a notification..................
Immunizing against exclusion
....There’s no doubt that Indian policy acknowledges the value of financial inclusion (FI). As early as 2005, the RBI mandated banks to offer a basic 'no frills' account (NFA) that would serve as a gateway for the excluded into the formal financial system. But the reality is that almost 90 percent of the NFAs opened till date is estimated to be dormant...........
Is Indian banking sector ready to take that leap?
As the rupee continues to hit new lows, economists and corporate honchos continue to predict deteriorating economic performance and politicians continue to fight over reforms like there is no tomorrow, the Reserve Bank of India (RBI) has recommended revamping the banking structure to further strengthen the backbone of our economy..................
Read.........
Read.........
Reserve Bank of India revisits ‘Small and Local’
......Notwithstanding India’s past attempt with Local Area Banks and Urban Cooperative Banks, it refers to similar recommendations of the Committee on Financial Inclusion (Rangarajan Committee, 2008) as well as the Committee on Financial Sector Reforms (Raghuram Rajan Committee, 2009), and puts forward the idea that such small localised banks have a pivotal role to play in financial inclusion and that this must be revisited as an important policy imperative. While specific questions need to be tackled, such as .........
RBI allows premature encashment of 8% Savings (Taxable) Bonds
The Reserve Bank today permitted premature encashment of 8 percent Savings (Taxable) Bonds for individual investors who are 60 years and above. This facility is after a minimum lock-in period of three years from the date of issue, RBI said in a statement...........
Food programme ill-timed: Bimal Jalan
..........The current macroeconomic situation is very distressing as of now. India’s GDP growth is low, CPI s high, current account deficit (CAD) is high, fiscal deficit is high, and you are seeing there is no confidence in the market.” His comments come within days of the RBI in its annual report raising concerns about the viability of the Food Security law.
Read.......
Of dollars and dahi
.......On the day that marked the birth of Lord Krishna, the organizer of one of the several dahi handis in the city, where a pot of curd and cash hung atop buildings is broken by revellers forming a human pyramid, ensured that the prize money was in dollars rather than rupees. The festival is now heavily politicized, so the man was making a political point: people are losing faith in the Indian currency..................
Rupee-smart holidays
.......So how to choose an overseas holiday with the rupee in free-fall? It's raining discounts and deals as tour and travel companies are partnering with hotels and airlines to offer holidays that fit the budget. They are leveraging 'upswings' and stability in the rupee against currencies of specific countries to offer significant savings. "With stability seen in Australian and South African currencies vis-a-vis the Indian rupee for the past few months, a strong demand is seen for holidays to these two countries from India," ........
Govt plans to set up bullion bank to mobilise idle gold
................ a proposal is under active consideration of the government of india and the RBI to set up a Bullion Bank or the Bullion Corporation of India (BCI) through which buying and selling of gold as well as accepting gold as a deposit and lending it to jewellers could be undertaken, said the sources familiar with the development...............
It’s the interest rate, stupid
.............Potentially, there are two sources of grief for an economy—fiscal and monetary policy. Regarding fiscal policy, several or most observers (including the outgoing RBI governor, Dr Subbarao) agree that UPA-2 regime has been responsible for possibly the worst fiscal policy that India has endured, and I would hazard a guess that outside of Venezuela, possibly the worst fiscal policy of any modern economy. And the nightmare just does not end.........
Sinking equity, currency markets show a braking Indian economy
.............Partly, it is monetary policy that tripped Chidambaram's efforts over the past year. In much of his five-year term, RBI Governor D. Subbarao, due to retire on September 4, single mindedly waged a war against inflation. Questions are now being raised on the pace of interest rates hikes and whether his stance on inflation, widely seen more due to India's supply constraints and less a function of excess money sloshing around, was the optimal one..............
Friday, August 30, 2013
D Subbarao: P. Chidambaram will one day say 'thank God RBI exists'
 |
| ................"I do hope Finance Minister Chidambaram will one day say, 'I am often frustrated by the Reserve Bank, so frustrated that I want to go for a walk, even if I have to walk alone. But thank God, the Reserve Bank exists',......................... |
Bidding Farewell, Subbarao Hints Boss isn’t Always Right
....“An
autonomous and apolitical central bank is a delicate arrangement too,
and will work only if the government respects the autonomy of the
central bank, and the central bank itself stays within its mandate,
delivers on that mandate and renders accountability for the outcomes of
its policies and actions,” he said. Subbarao said the government
should mind its business of governing and leave the markets to
regulators, unless there is a crisis.
Red - ET
Subbarao's parting shot
Subbarao admits monetary tightening should have started sooner
...“With the benefit of hindsight, I must admit in all honesty that the economy would have been better served if our monetary tightening had started sooner and had been faster and stronger,” Subbarao said in his last public speech as the 22nd Governor of the RBI, as he delivered the 10th Nani A Palkhivala memorial lecture here this evening. However, he said he had been taking the so-called “baby-steps” in real-time and not in hindsight. ”Because we had a classic V-shaped recovery from the 2008 crisis, that growth had not dipped in the Lehman crisis year as low as had been feared, and that growth in the subsequent two years was stronger than earlier thought.”.......
Corporate-run banks can serve economy better: D Subbarao
MUMBAI: Defending the decision to allow corporates to enter the banking fray, outgoing Governor D Subbarao today said as a knowledge institution, the Reserve Bank needs to change with times, and asserted that corporates will serve the economy better by entering the field. "We believe that world has changed, India has changed and banking has changed," Subbarao said, explaining the rationale to allow corporates into banking, .............
FM says he had said the same as Subbarao on economic woes
NEW DELHI: Finance Minister P Chidambaram today reacted to RBI Governor D Subbarao's comments on the reasons for the current economic woes, saying this is what he had said a couple of days ago. "This is no different from what I said day before yesterday," he told reporters here when asked to comment on Subbarao's criticism of government policies leading to a slowdown in the economy. ........
Shantaram slams banks for hounding mining-affected
PANAJI: Member of the Consultative Committee on Finance, Shantaram Naik, has criticized the Reserve Bank of India (RBI) and banking institutions for not coming to the rescue of mining-affected Goans.............
Linguistic inclusion....................
As a consultant- development finance, I have seen that bankers/ CSPs mention the terms 'Financial Inclusion', Business Correspondents etc.,in english when they communicate with the prospective clients. So, I sent out a mail a couple of months back to a number of SLBC conveners to give me the translation in the local language of the term 'Financial Inclusion'. I am yet to receive any response from any of the SLBC conveners. Perhaps, the words of the present Governor may also fall on the deaf years of the bankers as he is on his way out and the bankers will be waiting for the new incumbent Dr Raghuram Rajan to reiterate the need for use of local languages in marketing financial inclusion among the rural people.
- S.Santhanam
Elephant stops dancing
My View on "FinMin blames RBI policy, project clearance lag fo...":
Economy on rocks, not necessarily, thinks the Finance Minister even when the Re breached 68. We are still at an inflexion point as Rupee is yet to touch the downslide to 70 a dollar, as predicted by Dr Tarapore a month and odd ago in the Business Line. The inflation differential between the two countries India and US has been steady over the last two decades at 3.6% notwithstanding the great recession since 2008. This exchange rate adjustment, that is largely market driven, need not be seen as a weakness of the economy. There is a large domestic economy, if carefully nursed, could reverse the trend though not in the immediate future. As TVG mentioned the root cause for the malaise lies in governance failure. We cannot very much alter our import basket governed by the crude oil that is rising, and edible oil whose consumption in India far outstrips the production necessitating its continuing import and the heavy capital equipment required for infrastructure sector, in the short run. In sluggish manufacturing sector intensity, expecting recovery in the short run would be a wild goose chase. If we look at the emerging economies’ trends ever since Ben Bernanke announced the QE programme of unwinding bond purchases, global GDP all along etching its hopes on them, now looks tamed at 2.1% even in 2013. Chinese economy, though sent some shivers at the beginning of the year, started quick recovery and would seem to be steady on stabilising and may be at 7.7% growth. Among the BRICS, the other major, Brazil is looking for World Football Cup to come to its rescue. It is down from 3.5% to 2.5%. Unfortunately, India does not have an event like the Commonwealth or world tournament to milk the opportunity. After a long slumber on the policy front, India’s economic Czars announced a slew of reforms that would move like the wheels of Lord Jagannath’s chariot. They have been announced at a time when the sectors are not poised to respond. Now, the rating agencies that have been on a simmering hope would appear too keen to downgrade India’s sovereign rating. Although on some such hopefuls, the EIA predicted GDP growth at 6% for Asia and Afroasia (excluding Japan) in June 2013, is likely to shift it at 5.5-5.7%. Although the RBI in its Monetary Policy predicted a downtrend to settle at 5.5%, even the most optimistic projection does not now seem to cross 5%. The silver lining in the cloud of despair is that the NRI deposits are growing with the downfall of Re. Even in the backdrop of double digit consumer inflation index, domestic savings have not fallen yet; and the employment rate also remaining steady. The core sectors grew by 1% last month. Electricity generation showed improvement by 6.2% with the rise in hydel power backed by steady inflows in the command projects. More than average rain fall also predicts a hopeful growth of the farm sector. There is enough money rolling in rural areas still, thanks to the MNREGS and a few rounds of State elections that fuelled free money make a merry go-round. What is at danger, however, is the likely bourgeoning of fiscal deficit fuelled by the implementation agenda of Food Security Act 2013. The Centre’s expected funding of the order of Rs.900bn in 2013 on Food subsidies alone that has an embedded 40% leakage if we go by the CACP study, rings alarm bells of consequence. RBI’s Governor Subba Rao without mincing words said that the Act would ‘eat into the finances’; while the incumbent Raghuram Rajan said: “there is blatant flaw in the policy making.” While the tigers are mauled alright, the elephant would stop dancing and get chained in the cage.
- - Yerram Raju *The author is an economist and Director, Development & Research Services, New Delhi.
Interest rates and economic activity - Deepak Mohanty
Speech by Mr Deepak Mohanty, Executive Director of the Reserve Bank of India, to the
Association of Financial Professionals of India (AFPI), Pune, 23 August 2013
....Let me conclude. The Reserve Bank has been traversing a growth-inflation knife edge in recent years. The sluggish growth conditions in the last two years and the dampened investment activities warranted a shift in the stance of monetary policy. The extent of monetary policy easing, however, has been circumscribed by the persisting risks to inflation and the external balance position...............
Why not to follow " THE KARAM YOGA ".......
Our Dr.S.S.Tarapore ( Ex.Dy. Governor of R.B.I.) had in January,2013
forewarned fall in the value of Rupee. Now it is going from bad to
worse. Short term & half hearted efforts by RBI & Govt. Of India
have not been able to impact the rising graph so far.Not so appreciable
measures having been taken by RBI is understandable mainly because of
change of guards at Mint Road. Outgoing Governor Shri Subbarao &
the incoming Shri Rajan both are shying away from their responsibility. Global events, presumptions & dangers do have impact on Rupee in
addition to domestic reason of CAD, lack of WILL in G.O.I.to take
appropriate & timely action,absence of dynamic leadership in Govt.
& Opposition to steer clear of forex emergency converting into
economic gloom. Instead of crying hoarse of foreign hand,Govt. needs to make overall
efforts by involving Indian public as well who is much more patriotic
than Its leaders. There is no dearth of capable Indians who will succeed in ensuring
Rupee & India come out of the current malaise gloriously. The need is
urgent all round actions to avert loss of Trust of the World .
Considering the deplorable condition of Rupee, even after major
OPERATION it may continue to remain in ICU for a few weeks as market
never follows text book rules. Govt. need not ask us to have patience
& make the nation fatalist. Let the nation no more suffer from
inaction & apathy. Why not to follow " THE KARAM YOGA " propounded
in Gita by Lord Krishna.
- Ranjit Kumar Rehan, EXRBITES Group
Introspection on pension updation - P. R. R. NAYAR
......Yet,
you magnanimously kept hopes burning in
their hearts through frequent promises of immediate deliverance – fire that
would have warmed the progressively collapsing body walls of even the recently
deceased pensioner............
Forwarded by L R Parab
(Re)Quest for VITALINFO
Dear Mangeshji,
Your e mail address was given to me by Shri B K Kamath. We are ex RBItes & have settled in Blore. We called on him yesterday & spent some time chatting about old times. Kindly include my e address in your contact list & please mail me VITALINFO which you shoot out each morn. Looking forward to receiving your news bulletin.
Regards,
- Frank R Misquith
DA merger in Banks-impact
Process of merger of DA @ 4440 points as on 1-11-2011 – its impact on pay scales in Banks and RBI
As per the UFBU circular the IBA has agreed to merge the DA @4440 index numbers
(1960=100)in the basic pay. To understand the merger process let us keep in mind;.......
Narayana Murthy quits as chairman of NPCI
......NPCI has been promoted under the aegis of Reserve Bank of India by various banks as a not-for-profit organization. It is known for providing the IT backbone that connects ATMs of all banks. NPCI is also the promoter of Rupay — the Indian alternative to Visa and MasterCard. A P Hota, MD, NPCI, confirmed that Murthy has submitted his resignation to the board following his taking charge at Infosys in keeping with good governance practices. "Murthy's biggest contribution to NPCI has been the introduction of best practices in corporate governance. We today follow all the best practices of a listed company," said Hota..............
Soon durable and difficult to counterfeit plastic notes in five cities
.... The study concluded that infected currency was a potential public health hazard, as pathogens could spread by circulating banknotes and recommended caution while handling them. Doctors concur this view. “The present currency notes can easily have a number of micro-organism on them which could make you fall sick, right for common cold, to influenza to various gastrointestinal infections,”..........
New Rs 5 coins to mark Vivekanada's 150th birth anniversary
The Reserve Bank will soon issue Rs 5 coins to commemorate the 150th birth anniversary of Swami Vivekananda. "The government has minted the above coins (to commemorate the 150th birth anniversary of Swami Vivekananda), which the Reserve Bank of India will shortly put into circulation," RBI said in a press release.........
Bank customers in northeast reluctant to lodge complaints: Ombudsman
Guwahati, Aug 28 — Bank customers in northeast India are shying
away from lodging complaints for their banking problems in spite of having
ample facilities to do so, RBI's
Banking Ombudsman for the region Anand Prakash said Wednesday. Giving the
statistics, Prakash said the eight northeastern states together have registered
only 708 cases against banks during fiscal 2011-12 compared to the 72,000
complaints received by the ombudsman nationwide.............
RBI ombudsman gets most cases against SBI in North East
....In 2012-13, RBI’s banking ombudsman division received a total of 807 complaints from seven states — Assam, Arunachal Pradesh, Manipur, Mizoram, Meghalaya, Nagaland and Tripura. Out of that, 379 cases are against the SBI group, while 72 cases are against UBI and 49 cases are against UCO Bank. When asked about the private sector, RBI Banking Ombudsman secretary Awadhesh Kumar Kureel said, “Every year, we get highest number of complaints against HDFC and Axis Bank.”............
Rajan prescribes blending of imported and domestic coal to tackle supply crunch
...... “If they could be incentivised to blend as much imported coal as possible, it would free up domestic coal that could be allocated to other domestic producers. That freed coal has a multiplier effect because it can be used to blend with more imported coal, expanding the domestic production base substantially,”.............
Rajan's early and tough test on restoring confidence
.........Among the questions is whether Raghuram Rajan, the governor-in-waiting, would opt to raise policy rates, to show he means business. He faces a tough task. Within a fortnight of taking charge, he will have to announce the mid-quarter review of monetary policy, scheduled on September 18. It is to be seen if he can change the fortune of the rupee...........
Growth is key
The diagnosis of the problem by the RBI and the Finance Ministry is completely wrong and counterproductive. It not just the current account deficit. What you have playing out is that growth has collapsed and that is why investors are not finding Indian assets attractive. .......
Banks to face profitability pressure in current fiscal: Icra
........Icra analysed 26 state-run banks, and 15 banks outside government control in the quarter ended 30 June. These banks account for around 90% of the total credit portfolio and deposits of all commercial banks. “Core profitability of PSU (public-sector undertaking) banks have already dropped and last quarter they were cushioned by profits on sale of investments. But there is a clear pressure on profitability as mark-to-market losses are likely to increase because of the jump in bond yields,” Batra said..............
Rajan’s mandate
...... Sensitivity to inflation is extremely important and it requires rigorous statistical exercise, which the new RBI Governor, Raghuram Rajan, seems capable of. Non-banking financial corporations need to be given more space in the banking sector without imposing some of the norms that banks have to follow. Financial inclusion should be accorded priority........
Govt might buy gold from citizens
India is considering a radical plan to direct commercial banks to buy gold from ordinary citizens and divert it to precious metal refiners in an attempt to curb imports and take some heat off the plunging currency. A pilot project will be launched soon, a source familiar with the Reserve Bank of India (RBI) plans said.........
RBI should consider floating gold bonds - trade minister
..........."RBI (Reserve Bank of India) in the past has come up with many such schemes, there have been three gold schemes in the past," he saidm without giving details of how such a plan would work in practice............
Govt to blame for rupee woes: Subbarao
.........In probably his last public speech as RBI governor (he steps down in less than a week), Subbarao said pointing to factors outside India did not fully explain the rupee’s rapid depreciation. “Admittedly, the speed and timing of the rupee depreciation have been due to the markets factoring in ‘tapering’ by the US Fed, but we will go astray both in the diagnosis and remedy if we do not acknowledge that the root cause of the problem are domestic structural factors,” he said, delivering the Nani Palkhivala Memorial Lecture in Mumbai. The title of his lecture was ‘Five years of leading the Reserve Bank; looking ahead by looking back’.............
Subbarao defends RBI moves to stem rupee decline
.................Subbarao defended RBI’s actions, saying they were “consistent” with its policy. “Our capital account measures were aimed at encouraging inflows and discouraging outflows. Also, we tightened liquidity at the short end to raise the cost of short-term money so as to curb volatility,” he said. The outgoing governor reiterated that it is not RBI’s policy “to resort to capital controls or reverse the direction of capital account liberalization. The measures we took did not restrict inflows or outflows by non-residents”..............
‘ Our love for ‘ Phoren’ goods also responsible for rupee devaluation’
BHOPAL: A section of market analysts has alleged that the Union government was promoting ” satta” as RBI starts exchange of dollars in the evening, after the market closes. Ministers, politicians and big shots purchase the dollar and the next day they sell it, making a fast buck in the process. While another section of market analysts also blame people, who are addicted to imported items like cars and electronic gadgets. Therefore, it is the lifestyle of Indians which has devalued Indian currency and nothing else...........
Will Raghuram Rajan Do a Volcker?
...........Mr. Volcker bucked political pressure to keep rates low and instead hiked benchmark rates to record levels to curb high inflation. But while inflation came under control in the early 1980s, it also left but the U.S. economy in a recession. Some economists say that a similarly drastic step may be needed if Indian authorities are unable to arrest the rupee’s slide soon..................
RBI powerless as swaps signal deepening crunch
India’s incoming central bank governor Raghuram Rajan has little room to use borrowing costs to spur Asia’s third-largest economy as the rupee plummets, interest-rate swaps show...........
Go to the IMF, right now
It is hard to restore confidence in the rupee under the present conditions. Because for that a major perquisite is the restoration of faith in the UPA government. Since that does not seem to be happening, the rupee, and the stock markets, are set to remain volatile till a new government is in place after the next parliamentary poll. Yes, the UPA can still minimise the damage if it has the good sense to use the one option which has a very good chance of succeeding. And that is to go to the IMF to bolster its dollar kitty..........
The ageing rupee
...... "The rupee has fallen so much it has almost reached Chidambaram's age," said one commuter. Replied his companion gloomily, "And it will soon touch Manmohan Singh's age." ...........
Stabilise the rupee
.............Finally, there is an urgent need to revive manufacturing growth, which has been nearly zero for the past two years. The necessary actions have already been outlined in the National Manufacturing Policy. It would help to have a benign interest rate regime.
Rupee Seen on Slippery Path as Volatility Highest: India Credit
......Oil-price shocks triggered balance-of-payments crises in India in 1981 and 1991. During those periods of tumult, debt- servicing increased with the help of external commercial borrowings and deposits from non-resident Indians, according to a Dec. 7 speech by RBI Executive Director Deepak Mohanty. Since Aug. 20, the RBI has exempted banks accepting deposits from overseas Indians from keeping 4 percent of the money as cash and investing 23 percent in approved securities. Such deposits stood at $70.8 billion in the year ended March 31, compared with $58.6 billion in the previous year, RBI data show..........
This Janmashatmi Day – Krishna Was Missing To Save Disrobing of Indian Rupee
.........With the passage of every minute, Indian Rupee was being robbed layer by layer, and was wondering whether somebody or some news will appear suddenly, as in Mahabharata, and save our beloved Indian Rupee. However, as day progressed I realised Krishna was missing - or we may say he was yet to be born to give support to free falling of Indian Rupee. ...........
HDFC Bank to open 300 branches
Undeterred by the economic slowdown and a sluggish demand for credit, HDFC Bank Limited is planning to open 300 new branches across India, adding to its existing branch network of 3,119. The country branch head of HDFC Bank Navin Puri said the bank is waiting for the approval of the Reserve Bank of India over the new branches and is hoping to strengthen its presence in retail banking...........
HCBL Co-operative Bank organizes workshop on financial inclusion
.......The facility of 24*7 Banking E-Lobby has also been provided in remote areas so that customers can keep in touch with the Banking facilities at any point of time. This effort of the Bank to reach out its customers was well praised by the Governor of RBI - Dr. D Subbarao during his visit of the Bank's e-lobby in Lalpur Karota Village, Barabanki. As a step ahead towards its Social and Financial Inclusion, the Bank has supported and encouraged groups of Chikan and Zardoji Karigars who were originally being exploited by wholesalers.........
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