Tuesday, August 6, 2013

The collateral damage to banks from RBI

The last time the Reserve Bank of India (RBI) resorted to liquidity tightening tactics to shore up the rupee in 1998, the measures proved successful and were rolled back in two months. That does not seem to be the case this time around. If the central bank extends its latest measures beyond a couple of months, there will be collateral damage in the form of squeezed bank margins and lower earnings...............

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