RBI Vs Government

Here's how leading brokerages have interpreted the development, and their expectations from Sanjay Malhotra as regards key rates and maintaining a balance between growth and inflation

The rupee depreciated 4 paise to 83.55 against the US dollar in early trade on Monday, tracking the strength of the American currency in the overseas market and elevated crude oil prices. Forex traders said a positive trend in domestic equities and significant foreign fund inflows supported the rupee and restricted the fall. At the interbank foreign exchange market, the rupee opened at 83.53 and lost further ground to trade at 83.55 against the greenback in initial deals, registering a fall of 4 paise from its previous closing level. On Friday, the rupee settled at 83.51 against the US dollar. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was at 104.21, higher by 0.11 per cent. Brent crude futures, the global oil benchmark, advanced 0.11 per cent to USD 85.14 per barrel. Over the past week, the Indian rupee has remained steady against the dollar, consistently hovering around the 83.50 mark despite a brief weakening of the .

India, when compared to the US, has been rather boring, albeit in a good way. In contrast to the volatility in the US markets and macro data, India has been a beacon of stability

As of September 2023, the Reserve Bank of India held 800.79 metric tonnes of gold, including gold deposits of 39.89 tonnes

The Reserve Bank has told the International Monetary Fund (IMF) that the objective of frequent interventions in the forex market is to curb excessive volatility, dismissing the Fund's rationale for reclassifying India's exchange rate regime. The IMF, following the Article IV consultation with the Indian authorities, reclassified the status of the exchange rate regime to "stabilised arrangement" from "floating" for period between December 2022 to October 2023. India's Executive Director at IMF K V Subramanian and Senior Advisors Sanjay Kumar Hansda and Anand Singh questioned the selection period adopted by the Fund for analysis and also reclassification of the country's exchange rate regime. "... (IMF) staff characterisation of India's exchange rate as a 'stabilised arrangement' is incorrect and inconsistent with reality. As in the past, exchange rate flexibility would continue to be the first line of defence in absorbing external shocks, with interventions limited to addressing ...

Scale-based approach to enforcement, key mgmt personnel on the radar

Annual retail inflation in August was 6.83%, easing from 7.44% in July -- a 15-month high -- but remained well above the central bank's 2%-6% comfort band

Waning of base effect and uncertainty over monsoon may come in the way of disinflation, going forward

Take a tactical bet on longer-duration funds when RBI moves to a tightening stance

India's local city governments must consider issuing municipal bonds to meet their funding requirements as the demand to ramp-up infrastructure in the Asia's third-largest economy grows

Most applications have either been withdrawn or stand rejected

Analysts say RBI is allowing the depreciation amid wider CAD and higher US interest rates

The central bank looks to protect headline reserves, deter offshore/onshore arbitrage on Rs with buy-sell swaps in forex market

Meeting discusses that it's endeavour of regulators to ensure incidents like the NSE colocation scam don't repeat and there are better ways to deal with the fallout

SFBs were advised to continue to evolve in tune with the differentiated banking licence given to them with proportionate growth in their capital base.

From 1991 onwards, the RBI became a full, if slightly junior, partner of the finance ministry, instead of being a 'mere subordinate department of the financial ministry'

NBFCs can give dividend only if accounts are clean, NPAs not hidden, and are below 6 per cent for the last three years

Apex bank's Rs 99,122 cr dividend supports the Centre's fiscal rescue plan, obviates need to ramp up borrowings for now

'Autonomous institution has to deliver the services that the government has approved as part of policy framework', says Bimal Jalan.

Govt informed Rajya Sabha that no proposal with regard to change in the RBI's powers with respect to public sector banks was under consideration