Study implies there has been a secular deceleration in trend GDP growth since 2009
The Monetary Policy Committee (MPC), headed by RBI Govenor Shaktikanta Das, cut rates in February and April citing prospects of benign inflation. In the four months of 2019, the RBI has cut policy interest rates twice by 0.25 percent each to one-year low of 6 percent.
Those expectations for another rate cut have strengthened over the past month after Shaktikanta Das was appointed as the new RBI Governor in December. Lending rates were lowered and the policy stance shifted at his first meeting in February.
The Fed left its federal funds rate on hold last week as expected, but its "dot plot" projections shifted and now suggest no hikes in 2019 compared with two in December. A Reuters poll taken just two weeks ago predicted one hike this year.
Sakshi Batra does a 3 point analysis of the reasons behind SBI's move and will that prompt other lenders to follow suit.
A Reuters snap poll taken immediately after Thursday's policy review - where the RBI unexpectedly reduced interest rates by 25 basis points - showed the central bank will make the same move next quarter. That would take the RBI's repo rate to 6.00 percent, its lowest since the middle of last year.
On Thursday, the Reserve Bank of India caught financial markets off-guard by reducing its key policy rate by 25 basis points to boost growth and as inflation has remained benign.
The RBI is scheduled to announce its sixth bi-monthly policy review for the fiscal on February 7. It would be the first Monetary Policy Committee meeting under RBI Governor Shaktikanta Das, who took charge in December 2018 following sudden exit of Urjit Patel.
A softer stance would bode well for Prime Minister Narendra Modi's government, which wants to boost lending and lift growth as it faces elections by May.
In a note Friday, Bank of America Merrill Lynch, however, said the fiscal "risks are overdone".
"NPAs have made the banks cautious. But, India can do with slightly lower rate of interest," Basu said at an interactive session organised by the Indian Chamber of Commerce here.
Here's a roundup of the key happenings in the commodities market, with a deep dive into some of the most active counters
Banks offer loans on fixed interest rate and floating interest rates. So, often borrowers are in dilemma which interest rate to select while applying for a loan.
Under the revised rates, the bank will offer 5.5 percent per annum interest rate on deposits of upto Rs one lakh.
Fed Chairman Jerome Powell also said the central bank would continue drawing down the size of its balance sheet by $50 billion each month.
The central bank is due to announce its decision at 2 p.m. EST (1900 GMT) after its final two-day policy meeting of the year. Fed Chairman Jerome Powell is scheduled to hold a press conference half an hour later.
While banks do offer certain floating interest rate options on deposits, it is not yet prevalent in the market
For the second time in a row, the central bank maintained status quo on all key policy rates in the fifth bi-monthly monetary policy review announced Wednesday.
For borrowers, the new framework is aimed at making loan pricing more transparent. But it may also mean more volatility in their EMIs
Monetary policy stance or the tone of the policy could turn less hawkish, experts said
Yi's comments come amid widespread expectations that the central bank will ease policy further in coming months to support China's economic growth, which has cooled to the weakest pace since the global financial crisis.
The recent public row between the government and the RBI over policy matters unrelated to monetary policy has "somewhat diminished" the central bank's independence according to a third of the 46 respondents, though two-thirds saw no major impact.
According to Dun & Bradstreet Economy forecast, the robust agriculture production and softening of vegetables and fruits prices will also help in keeping the food inflation under check.
M Saraswathy is in conversation with Ravi Krishnan, Deputy Executive Editor, Moneycontrol, to discuss the underlying factors that caused the confidence deficit in India's shadow banking sector.
Earlier this month, SBI said they have room to buy a total of Rs 45,000 crore, from Rs 20,000- Rs 30,000 crore more than the initial estimate of buying Rs 15,000 crore worth of portfolios