The aggregate deposits of the banking system increased by Rs 2,269 crore during the fortnight ended May 22, while bank credit declined by Rs 656 crore with the Rs 1,623 crore rise in food credit being off set by a Rs 2,279 crore decline in non food credit.
Investments by banks in government and other approved securities increased by Rs 2,647 crore.
Resource flow to the commercial sector in the current fiscal has dropped by Rs 3,305 crore, investments in government and other approved securities rose by Rs 12,711 crore while aggregate deposits went up by Rs 11,693 crore.
* As on May 22, the cash deposit ratio stood at 9.98, the investment deposit ratio was 37.60 and credit deposit ratio at 52.36.
* The foreign currency assets of Reserve Bank of India (RBI) increased by $47 million during the week ended May 29, while its stock of special drawing rights (SDR) declined by $9 million.
The value of gold held by it was unchanged. As on May 29, the forex reserves of RBI was $ 28,757 million with the FCA at $25,569 million. The stock of gold was at $3,184 million and SDR at $4 million.
In the current fiscal, the FCA of RBI has declined by $406 million, the stock of gold held by it has declined by $207 million while the SDRs held by it has gone up by $3 million. Thus forex reserves have declined by $610 million.
* The recourse of the central government to ways and means advances stood at Rs 10,306 crore on May 22.
This had prompted the private placement of Rs 5,000 crore worth of 10 year paper by the central government with the Reserve Bank of India.
In this financial year, the Reserve Bank of India's support to the government borrowing programme has been Rs 13,999.50 crore.
* This has resulted in a 5.9 per cent increase in net Reserve Bank of India credit to the government by May 22 as against a growth of 2.7 per cent in the corresponding period last financial year.
However, a 9.1 per cent decline in Reserve Bank of India`s credit to banks and the commercial sector has ensured that by May 22, reserve money has grown by only 0.1 per cent in this fiscal as against 4.2 per cent in the same period last year.
The year-on-year growth in money supply on May 8 stood at 17.2 per cent as against RBI's intended trajectory of 15 - 15.5 per cent.
In the forex market, the State Bank of India has been defending the rupee at 41.80 and if the latter is defending the local currency at the behest of the Reserve Bank of India, there would a contraction in the rupee resource base of the banking system.
