The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
Friday, May 2, 2014
How to manage portfolio capital flows - Dr.S.S.Tarapore
MONETARY POLICY - A Welcome, Refreshing Approach : M.G.Warrier
‘The Govt & Central Bank Need to Work Together to Tackle Supply-side Issues
...........The key to all of Rajan is that he is from University of Chicago. And you have got to remember that Chicago economics is all about the relationship between the economic actions and the information that you have about the future. And Rajan’s policies have been designed to try and talk down what you think inflation will be 12-24 months from now. That’s what inflation targeting debate is all about. If you think an ex-professor of Chicago is talking, you understand exactly what he is up to............
Read - ET
After autonomy, the need to fix proper accountability of regulators
......Direct accountability of regulatory bodies to parliament is not Chakrabarty’s original idea and was recommended by the Damodaran committee last year. In addition, a draft regulatory reform bill, approved by the government last year, which also made similar recommendations, did not come up for consultation. In India, where most committee reports are reduced to good pieces of literature and draft bills and don’t see the light of the day for years, more and more regulators demanding not just more autonomy but also more accountability could mean that the Damodaran committee recommendations and the draft regulatory reform bill may be formalised. Former RBI governor D Subbarao has also expressed his support for making RBI directly accountable to parliament. Prior to his retirement in September last year, he had said that while the RBI Act does not lay down any formal framework to ensure accountability, it does follow “certain good practices (which) have evolved over the years.”............
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- C.L. Nag, GM DNBS Kanpur
Why Raghuram Rajan will have to surrender to a Modi government
........If the next Government is bold, it will prioritise agricultural reform and fiscal consolidation for its first three years in office and then think about inflation targeting for the RBI in the latter half of its term. That time frame may be too long for Rajan, whose terms finishes a little over two years into the next Government's term, but it is probably the only politically reasonable and feasible way to proceed..............
RaRa - Realistic Analysis
My View on "Why Rajan stands out":
Very realistic analysis. By discussing more, we may be, in a way helping gossip-mongers and certain vested interests which are not comfortable about the stability in the Indian financial sector which is being preserved during these tough times. There were no two views about the selection of candidate for appointment of RBI Governor when Dr Raghuram Rajan was offered the post. With the exception of some media persons and some politicians who are not holding any responsible position, no one has raised any doubt about Dr Rajan’s continuance post-Election 2014. The people who go on opening up discussion again and again are unaware of how RBI functions or are interested in destabilising the Indian economy.
- M.G.Warrier
The Rupee Dilemma
.........In a 2006 speech, Rajan, then the economic counselor and director of research at the International Monetary Fund, argued that lax monetary policy in rich countries could lead to dangerous macroeconomic distortions in developing countries. He claimed that investors purchase risky assets when advanced economies have falling interest rates, only to sell those assets when interest rates rise again. He termed this phenomenon “risk-shifting.” .............
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Controlling inflation by RBI
...........Without such an act giving power to RBI, this situation continues whatever measures RBI takes to control prices are not going to be of any sensible effect. In this context I request governor of RBI to convince the coming new government that an act be passed so that all prices and taxes levied by these authorities are approved by the Bank before they are implemented. Without prior approval of RBI no tax and increase in prices will be applicable.........
Read.........
RBI to issue Rs. 100, Rs. 50 banknotes with 2014 printing year shortly
..........."The Reserve Bank will shortly issue Rs 100 denomination banknotes incorporating symbol on the obverse and reverse, with inset letter L in both the numbering panels, in the Mahatma Gandhi Series-2005 bearing signature of Raghuram G Rajan, Governor, RBI," ..........
RBI may not ease rates till Jan 2015: Icra
......."The expectation of below-average rainfall in conjunction with the structural factors that exert stickiness on food and non-food CPI inflation would make it challenging for the RBI to contain CPI inflation below 8 per cent by next January," the rating agency said on Thursday. Therefore, "the most likely scenario" is an extended pause for policy rates and monetary easing will be delayed until, at least, early 2015, the agency added..........
Deadline ends, old cheques make way for safe, fast CTS
...........Transactions with cheques that have magnetic ink character recognition (MICR) and not CTS technology will from Thursday be delayed, with banks likely to take four days or more from the date of deposit to credit the amount. Banks will from now clear MICR cheques only on Mondays and Fridays instead of three days a week, an RBI official in Chennai said. ................
CTS cheque clearance facing delays
..........In most cases one day interest may not be sizable amount for an individual and hence the customer will not follow-up with the bank. However, in the above case, the customer did write to Bank of Maharashtra giving details of the proof given by Yes Bank. The customer was given credit of one day interest by Bank of Maharashtra, which proves that customers today are facing not just delay of cheque clearance but also loss of bank saving rate interest for a day or more. Will RBI issue a circular so that banks give necessary credit for loss of interest without the customer asking for it?.......
An SIP that provides $ hedge
.......While the fund house is targeting investors who will have dollar expenses in the future – child’s education or foreign travel. The good part is that the dollar reference rate (Reserve Bank of India reference rate) used for deducting will be of the week preceding the investment date. For instance, if you are investing on the May 15, the dollar rate considered will be of May 8. So, there will be some hedge available. In the case of this SIP, fluctuations in the currency, much like the stock market volatility, will get balanced ........
Shilpa Shetty’s Gold Scheme May Hit Regulatory Hurdle
Celebrity entrepreneurs Raj Kundra and wife Shipla Shetty are selling a dream to people who want to own gold, if regulators do not object to the plan. Satyug Gold, a company promoted by them, is offering discounts of up to 37% on the purchase of gold bars and coins for those who are willing to pay the entire amount in advance and wait for two to five years to take delivery............
Read - ET
Read - ET
When your banker asks you to buy or sell a stock, simply ignore!
...........“It is important to restrict banks from selling insurance products (Life & General). Unfortunately the Reserve Bank of India (RBI) has not yet done anything on this issue. These days bank jobs are not to develop one's career as a banker but to become a salesman without paying much attention to the seriousness of banking business.” In April 2013, Moneylife Foundation sent a memorandum to RBI Governor on behalf of more than 21,500 members (at that time) to free the system of mis-selling of financial products by bankers, misusing the savers’ trust.........
'Pvt banks made good profit on unsecured loans in FY14'
........Private sector lenders witnessed robust growth in credit cards and personal loan businesses in FY14, which helped them boost top line amid sluggish corporate credit demand in a slowing economy. ICICI Bank, India’s largest private sector lender, witnessed 141.6 per cent growth in personal loan disbursement in the past financial year, according to a report by Emkay Global Financial Services. The lender also saw.......
Pay Vile Parle woman 3L, consumer panel tells bank
The state consumer disputes redressal commission has brought to book a bank for causing a loss of Rs 1.70 lakh to a Vile Parle woman, after it wrongfully retained 1,000 shares furnished by her as security for a cheque. Bank of Baroda will have to pay complainant Ketki Mehta Rs 1.70 lakh, along with a compensation of Rs 1.42 lakh. .........
Read - TOI
Read - TOI
A single platform to pay all your bills?
........RBI is looking to build an entity similar to the National Payments Corporation of India (NPCI), which ensures standardized payment solutions. For instance, NPCI’s immediate payment system, an instant interbank electronic fund transfer service, allows you to transact across bank accounts. Similarly, the centralized bill payment system will allow you to transact across billers from a single point...............
Pay college fee via credit card EMIs
.....Not only are banks recovering lost ground after RBI barred them from providing ‘zero percent’ EMI schemes, they have added new segments, including educational institutions like Sikkim Manipal University and coaching institutes like South-based Byju’s Classes. Very soon, consumers may also be able to pay their health and motor insurance premium through monthly EMIs thanks to this facility.......
Don’t Let Reward Points Influence Your Card Usage
...........Aim to select a card that suits your needs than trying to shop for products and services that will yield reward points. Stick to a couple of cards that meet your requirements instead of hoarding several cards solely for rewards. “You should not obtain a credit card or use it for making payments merely to earn reward points. Reckless spending can lead you into debt traps. Credit cards are meant to be used only during emergencies. Use debit cards for making payments as far as possible,” .............
Read - ET
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