.... while RBI’s steps are positive, inflow may take some time. “It’s definitely a positive measure. The bottleneck on refinancing of loans having been removed. I think it will serve two purposes. One the limit can be quickly used up, because project loans and capex loans typically take a long time in getting drawn. So even if an ECB was placed for a new project, it will take long time to be drawn. Therefore, the dollar inflows into the country will take a long time,” .........
............ Neither the currency nor equity markets cheered the new RBI policy measures announced on Monday , but only hoped for more. To arrest the falling rupee, the central bank hiked the limit of external commercial borrowing (ECB) to USD 10 billion. Moreover, the regulator also increased the limit of overseas investment in government bonds by USD 5 billion to USD 20 billion. However, Sajjid Z Chinoy, Asia Economics, JP Morgan explains that the measures are no game changers but only tactical in nature.......
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......To a market primed for more spectacular policy announcements such as foreign direct investment in retail, the actual measures announced by the Reserve Bank of India (RBI) on Monday, which focused primarily on the rupee, came as a disappointment. But given its constraints, the RBI has, in fact, done a good job of putting together a package that can support the flagging rupee. Of the various measures announced, the one that may prove most effective in bringing in dollar inflows immediately is the enhanced limit for foreign institutional investments in government securities.......
Read..........
The Reserve Bank of India's much hyped booster dose for a mauled rupee comes with a cost. The central bank's latest move to liberalise external commercial borrowings (ECB) is actually a continuation of its reliance on debt inflows to check the rupee slide. In the last six months, RBI has been increasingly attracting debt inflows through foreign debt, NRE and FCNR (B) deposits......
Read..........
......To a market primed for more spectacular policy announcements such as foreign direct investment in retail, the actual measures announced by the Reserve Bank of India (RBI) on Monday, which focused primarily on the rupee, came as a disappointment. But given its constraints, the RBI has, in fact, done a good job of putting together a package that can support the flagging rupee. Of the various measures announced, the one that may prove most effective in bringing in dollar inflows immediately is the enhanced limit for foreign institutional investments in government securities.......
Read..........
The Reserve Bank of India's much hyped booster dose for a mauled rupee comes with a cost. The central bank's latest move to liberalise external commercial borrowings (ECB) is actually a continuation of its reliance on debt inflows to check the rupee slide. In the last six months, RBI has been increasingly attracting debt inflows through foreign debt, NRE and FCNR (B) deposits......
Read..........
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