Top Headlines: Centre's capex Q1 outlay, Fed hikes rates by 75 bps, & more

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Centre's capital expenditure outlay in Q1 could be close to Rs 1.5 trillion

The Centre’s capital expenditure (capex) outlay for the April-June quarter (first quarter, or Q1) of 2022-23 (FY23) could be close to Rs 1.5 trillion, Business Standard has learnt. As a percentage of full-year capex Budget Estimates (BE) of Rs 7.5 trillion, this could be at similar levels to the trends in the past few fiscal years. Read more

Fed raises rates by 75 bps to tame inflation, flags weakening economic data

Federal Reserve officials raised interest rates by 75 basis points for the second straight month and Chair Jerome Powell left the same move again on the table for the next meeting in September, depending on how the data comes in. Policy makers, facing the hottest cost pressures in 40 years, lifted the target for the federal funds rate on Wednesday to a range of 2.25% to 2.5%. That takes the cumulative June-July increase to 150 basis points -- the steepest since the price-fighting era of Paul Volcker in the early 1980s. Read more 

Banking liquidity surplus shrinks on RBI's defence of rupee

Over the last couple of days, the interbank call money rate has hardened towards the upper band of the Reserve Bank of India’s (RBI’s) interest rate corridor as the liquidity surplus in the banking system has shrunk significantly due to the central bank’s interventions in the currency market, treasury officials said. Read more

DGCA orders SpiceJet to operate only half of its flights for 8 weeks

Indian aviation regulator DGCA has directed low-cost airline Spicejet to operate only 50 per cent of its flights for eight weeks. This follows an unusually high number of incidents involving the airline, raising safety concerns. The curtailment of capacity is unlikely to have any commercial impact on the airline owned by entrepreneur Ajay Singh. SpiceJet already operates less than 50 per cent of the flights it had filed for the summer schedule. Read more

Trade settlement in rupee: Banks seek clarity on fund repatriation

Banks have sought clarity from the Reserve Bank of India (RBI) on whether surplus funds accumulated through international trade settlements in rupees can be repatriated to the host countries of entities involved in such transactions, central bank sources told Business Standard. The RBI, on July 11, announced additional arrangements for invoicing, payment, and settlement of exports and imports in rupees. The exchange rate for such transactions may be market-determined, the central bank said. Read more

After HDFC Bank, more banks may offer higher rates on NRE deposits

After India’s largest private lender HDFC Bank set up a two-day window for non-resident external rupee (NRE) deposits offering significantly higher interest rate than those currently available, more banks are likely to come up with such offers, bankers said. “We will most likely be announcing a fresh set of rates for NRE deposits in the next couple of days. Our asset liability committee (ALCO) will be meeting to discuss the exact rate and it will be announced very soon,” an executive director at a private bank said. Read more