Comments
Following are the highlights of the RBI’s second quarter review of monetary policy 2013-14:
* Repo or short-term lending rate up by 0.25 per cent to 7.75 per cent.
* Cash reserve ratio unchanged at 4 per cent.
* Marginal standing facility (MSF) rate cut by 0.25 per cent to 8.75 per cent.
* Difference between repo and MSF rate narrows to 1 per cent.
* Repo hiked due to upturn of inflation, other factors.
* Wholesale inflation expected to be higher than current levels; warrants ‘appropriate policy response’.
* Retail inflation to hover around 9 per cent.
* Food price pressures may ease with the arrival of summer crop harvest and seasonal moderation.
* Prospect of delay in taper of US Fed Reserve’s bond purchases has brought calm to financial markets.
* Normalcy will be restored in the forex market only when OMCs fully return to the market for their demand.
* FY14 GDP growth estimate revised downward to 5 per cent vs. 5.7 per cent.
* Growth likely to pick up in second half on good show in exports and agriculture.
* Liquidity pressures building on small businesses as large entities holding on payments; remedies lie in speeding-up of Government and PSU payments.
* Average drawdown from MSF has declined to Rs 0.4 trillion by mid-Oct, down from a high of Rs 1.4 trillion in mid-Sep
* Final guidelines on unhedged forex exposures by corporates to be out by December
* Jalan panel on new bank licenses to hold first meet on Nov 1, decision of RBI on in-principle approvals will be final.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.