Following the November print of 5.54%, RBI had sprung a surprise and opted to hold the repo rate at 5.15 per cent. It, however, continued with the accommodative stance as long as it was necessary.
The government had in 2016 constituted MPC to set the benchmark interest rate
Patra, who was the executive director, took over the post that was lying vacant since June last year when Viral Acharya resigned
Das said he hoped a recent trade deal between the United States and China would hold and not be reversed
All these analysts agree that a rate cut is on the table but are not the same page on the timing though
'We expect a gradual recovery in income growth right into the second half of next year', said Das
Given that inflation will stay elevated in the next couple of months, a rate cut in Feb and April is ruled out, at least logically
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Repo rate now stands at 5.15%, lowest in nine years. A sixth cut this year would mark the longest streak of consecutive rate cuts since the current interest rate framework was introduced 20 years ago
The Governor has already hinted that the benign inflation provides room for further monetary policy easing while space for fiscal space is limited
The new effective rate takes India closer to its regional peers, on par with China, South Korea, Indonesia and OECD average
Central bank watchers are already battling to predict policy makers' next move after the MPC cut interest rates by an unconventional 35 basis points
What is telling is that large swings in the Indian business cycle are still not a thing of the past, despite the adoption of inflation targeting in India
Calling for radical corporate governance reforms at state-run banks, Das said their real test would be their ability to access capital from the markets rather than depending on the govt
RBI has cut interest rates four times this year
If the RBI does cut rates in October and early next year it will be the most aggressive amongst major central banks in easing policy
Whilst the noise on feasibility of budget numbers and risks on sovereign borrowing would persist in the near term, the budget outcome has certainly eased the job for RBI MPC to ease rates further
The RBI reduced its main rate by an unconventional 35 basis points to 5.4%, the lowest since 2010
The detailed instructions in this regard will be issued by the end of September 2019
The NBFC segment has been facing trouble since the collapse of the infra-focused IL&FS in September 2018