RBI Monetary Policy: Rates kept on hold
The Reserve Bank of India (RBI) announced its first Bi-monthly Monetary Policy 2014-15 today. The RBI kept the key interest rate unchanged at 8%. Repo rate, the rate at which the RBI lends to banks, remains unchanged at 8%. Consequently, the reverse repo—the rate which the RBI pays banks for depositing excess funds—rates remain unchanged 7%. The cash reserve ratio—the proportion of deposits to be kept with RBI—remains unchanged at 4%. The marginal standing facility (MSF) rate and the Bank Rate at 9.0 per cent. The annual rate of inflation, based on the monthly wholesale price index, stood at 4.68% in February, while retail inflation was at a 25-month low of 8.1%, according to the government data. Dr Rajan, who took charge as Governor of the apex bank last September, raised the rates during his first policy announcement, rightly foreseeing a pressure on the inflation front. He increased it again for a third time since he took charge, in January. In its third quarter review of monetary policy, the RBI raised the key repo rate by 0.25% to 8% in January in a bid to curb inflation...Read More
Reaction on RBI Monetary Policy:
Govt appoints R Gandhi as RBI deputy governor
R Gandhi has been appointed Deputy Governor of the Reserve Bank of India on Thursday. According to the notification issued by the Government of India, Gandhi has been appointed Deputy Governor for a period of three years from the afternoon of Thursday, April 03, 2014. Gandhi was Executive Director of the Reserve Bank before being elevated to the post of Deputy Governor. Gandhi will look after the following portfolios: Department of Banking Operations and Development, Department of Non-Banking Supervision, Urban Banks Department, Department of Expenditure and Budgetary Control, Department of Information Technology, Legal Department, Premises Department and Risk Monitoring Department. Having joined the Reserve Bank of India in 1980, Gandhi has built, over these thirty three years, expertise and experience in varied fields which include, payment systems and information technology, financial markets (money, securities, forex and capital market) operations and regulation, currency operations and management, personnel and human resources management, industrial credit and international banking...Read More
IDFC, Bandhan Financial Services get RBI nod to set up banks
The Reserve Bank of India (RBI) has decided to grant "in-principle" approval to two applicants viz., IDFC Limited and Bandhan Financial Services Private Limited, to set up banks under the Guidelines on Licensing of New Banks in the Private Sector issued on February 22, 2013 (Guidelines). These two applicants were also recommended as suitable for grant of "in-principle" approval by the High Level Advisory Committee (HLAC) set up by the RBI. The HLAC had also recommended that in the case of Department of Posts which has applied for licence, it would be desirable for the RBI to consider the application separately in consultation with the Government of India. The RBI has accepted the recommendation of the HLAC. "While RBI has been conservative in granting in-principle approval to only two applicants in this round based on the eligibility criteria defined and other quantitative and qualitative aspects, what is very heartening to note is the stated outlook to review the guidelines and make this a regular process moving towards an 'on-tap' policy including differentiated licenses," Shashwat Sharma, Partner-Financial services, KPMG, said...Read More
India's Manufacturing PMI stands at 51.3 in March
March data highlighted a further improvement in business conditions across India’s manufacturing economy. Nonetheless, the headline PMI dipped lower, as output and new orders increased at weaker rates. Encouragingly, growth of new export orders picked up pace over the month. Down from February’s one-year high of 52.5 to 51.3 in March, the seasonally adjusted HSBC India Purchasing Managers’ Index (PMI) signalled a slight and weaker improvement of business conditions across the country’s goods producing sector. Nonetheless, the PMI average for Jan-Mar 2014 (51.7) was the highest since the same period in 2013.
Consumer goods continued to outperform the other two market groups, with robust increases in output and new orders registered in March. Operating conditions also improved at intermediate goods companies, but deteriorated in the capital goods category. Manufacturing production growth across India eased from February’s one-year high and was modest overall. While panellists reported higher levels of incoming new work, there was evidence suggesting that competitive pressures and shortages of some raw materials hampered growth. Similarly, new orders rose at a weaker clip in March, with the respective index dropping since February and being below the long-run series average. Survey participants commented on higher underlying demand, but indicated that increased competition for new work and the elections had weighed on growth...Read More
Feb Eight core industries growth at 4.5%
The Eight Core Industries have a combined weight of 37.90 % in the Index of Industrial Production (IIP).
The combined Index of Eight Core Industries stands at 156.7 in February, 2014, which was 4.5 % higher compared to the index of February, 2013. Its cumulative growth during April-February, 2013-14 was 2.6 %.
Coal production (weight: 4.38 %) increased by 0.1 % in February, 2014 over February, 2013. Its cumulative index during April to February, 2013-14 increased by 0.9 % over corresponding period of previous year.
Crude Oil production (weight: 5.22 %) increased by 1.9 % in February, 2014 over February, 2013. The cumulative index of Crude Oil during April to February, 2013-14 declined by 0.1 % over the corresponding period of previous year.
The Natural Gas production (weight: 1.71 %) declined by 4.4 % in February, 2014 over February, 2013. Its cumulative index during April to February, 2013-14 declined by 13.3 % over the corresponding period of previous year...Read More
Weekly: Sensex, Nifty ends flat
After a splendid run in February and March, the indies took a breather this week with profit booking seen on Thursday and Friday. Locally, the political situation will be gauged closely as India prepares to vote in the coming weeks. Globally, investors will look at cues from the US market, especially the jobs data to see if there are any signs of improvement. The Euro zone situation will also be closely eyed. IMF has also raised concerns on the global economy.
The Nifty hit a peak of 6,777 during the week but failed to sustain at higher levels. Sentiment got a hit after services purchasing managers index declined to 47.5 in March from 48.8 in February, registering below the 50.0 no-change level for the ninth successive month.
Meanwhile, RBI kept the Repo rate and CRR unchanged at 8% and 4% respectively and the ‘monetary pause’ could stay for a while. There are many reasons that could prolong the rate cut cycle - The RBI is skeptical about the sustainability of waning food inflation pressures seen in recent months and interprets stickiness of core inflation. There is a risk to inflation from a below-normal monsoon due to possible ‘El-Nino’ effects and increase in minimum support prices (MSP). In terms of macro-economic points, IIP for the month of February and the Trade Data for March are what investors will watch out for in the coming week...Read More
Online retail at all time high with 1 million retailers: IAMAI
IAMAI has released industry figures that indicate robust growth in the online retail business in India estimating the number of online retailers as close to 1 million as of date. Speaking on the numbers, Dr. Subho Ray, President IAMAI said that "Nearly 1 million large and small retailers make use of online marketplaces to reach out to their customers in India today. These online retailers represent a very wide range of categories including electronics, books, apparel, accessories, footwear and jewellery."
"The presence of such a large number of online sellers testifies to the efficiencies, disintermediation, lower capital costs and deep outreach that online marketplace provides to the retailers," he added. The association has estimated that online retail accounted for US$12.6bn (Rs.62,967 crores) showing a year-on-year CAGR of 34% since 2009 and is expected to escalate further as policy and FDI issues are addressed and delivery logistics come of age. Industry experts have pointed out that growth in the online retail space in India is following a global trajectory and is proving to be sustainable and profitable marketing and distribution model. Agglomeration and consolidation in the online retail business is also a strong indicator of the robust fundamentals of the business model...Read More
Boys vs Girls fitness Levels: Edusports survey
Come summer and children and parents alike look forward to a break from school routine. Month long holidays mean more time to spend on video games, late night movies, internet games and outstation vacations. All this sounds like fun, but look deeper and you will find cause for alarm. The advent of the internet age has seen a sharp decline in physical activity causing children to spend less time outdoors. The summer months accentuate the problem further as the emphasis on physical outdoor activity takes a backseat. In a study conducted by Edusports, India’s largest school sports and Physical Education Company, it was found that the health and fitness levels of children post summer holidays displayed a sharp decline as compared to fitness levels at the end of the previous academic year. Sedentary lifestyles and unhealthy food habits accompanied by lack of exercise reduced the sporting ability of children, especially during the summer holidays.
Results of the 4th edition of the EduSports Annual Health and Fitness Survey released in 2013, indicate that the percentage of children with above average performance in sprint ability improved from 62% to 67% after being exposed to a structured sports programme through the year. However, when the sprint test was done again at the start of the next academic year (after the summer holidays), only 59% of kids scored in the same range. It was also noticed that there was a similar drop in the number of kids scoring high on the flexibility parameter (from 57% to 49%) after summer holidays. Another interesting finding was that children lost both upper and lower body strength...Read More
Mobile phones a clear choice in India for watching Mobile Video: Vuclip
Vuclip, the world’s largest independent mobile video and media company, announced today the results of a study of Vuclip’s user base conducted by leading global marketing and research firm Millward Brown. The study revealed that Vuclip’s more than 20 million mobile video consumers in India are largely trending towards mobile devices as their go-to source for content with 81% of metro and 87% of non-metro survey participants identifying mobile phones as a preferred medium. Moreover, 80%, an overwhelming majority, of Vuclip’s consumers report watching videos on their mobile devices at least once every 2-3 days, with more than half opting to watch daily...Read More
Mini Cooper: Retro chic!
After BMW relaunched the Mini in 2000, my earliest impression of the classic small car was in the 2003 Hollywood blockbuster The Italian Job. The sight of those cute little car being first driven by Charlize Theron, and then later on in the reverse heist of the gold was enough to send sales soaring for this marquee. And it set many a heart aflutter, not just because of the sight of sultry Theron (and dashers like Jason Statham and Mark Wahlberg) behind the wheel of this sexy car, but also due to the utter beauty of a classic small car making its way nimbly through the busy streets, sewers, and metro tunnels of Los Angeles, and helping the protagonists towards the climax.
Now in India (it was introduced to India during the 2012 Auto Expo and launched in the same year), the brand has been positioned as a classic retro – aimed at the well-heeled buyer, who is aware of the brand, and is willing to pay a higher price for the classic brand, combined with personality, flair, and a host of modern features. The Mini has been thoroughly modernized by BMW, and now combines British mini-car heritage with German precision. While the Mini remains faithful to its antecedents, the present designers have created a design that reminds you of the old classic and yet is a very modern car...Read More
Mercedes ML 350 CDI: A complete all-rounder
The Mercedes ML class brings back fond memories for me as it was the first car from the three-pointed star that I ever drove in my life on the highways, kicking up crazy speeds. Till then I had never expected that I could negotiate big cars so easily, and the sheer driving pleasure that I derived over the three days that I had that car is something I savour even now. In fact, I can say justifiably that my love affair with big SUVs that started as a crush with the Pajero got cemented with that drive a few years back in the big ML. So when Mercedes asked me if I would like to drive the new generation ML350CDI, I was more than ready. From a distance, the ML350CDI that came below my house at the appointed hour seemed essentially the same as the ML it has replaced. But look closer and there are quite a few changes. The platform, essentially, remains the same, but Mercedes has made a few changes, including to the design, engine, and features. I decided to not waste time and get out of my house quickly to get my hands on the beast…Read More
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