Page 4 - Interest Rates

Fixed income outlook 2025: Lock into peak rates as cuts are likely

The much-anticipated interest rate cut cycle may be delayed, but experts believe the Reserve Bank of India (RBI) will reduce rates in 2025

High rates, declining finance impacting exporters' competitiveness: CII

Indian exporters are grappling with significant liquidity challenges due to high interest rates and a decline in export finance, which are undermining their competitiveness, according to Sanjay Budhia, Chairman of the CII National Committee on EXIM. To address these issues, he said, the government and banks must work together to provide effective solutions. Budhia suggested the government extend the interest equalisation scheme, which ended on December 31, 2024, for three years for all manufacturing exporters, including MSMEs (micro, small and medium enterprises). The longer period extension of the scheme would be a crucial step, as its limited extension leaves Indian manufacturers at a disadvantage, he added. "Exporters are indeed facing significant challenges on the liquidity front, with high interest rates and declining export finance impacting their competitiveness," he told PTI. MSME exporters, who form the backbone of India's export ecosystem, would benefit greatly from ...

Dollar gains as US Fed's rate-cut rethink fuels best year since 2015

The dollar advanced against all of its major peers in 2024, with the New Zealand dollar, Norwegian krone and Japanese yen weakening the most against the US currency

Govt retains interest rates on small savings schemes for Jan-Mar quarter

The government on Tuesday left the interest rates unchanged on various small savings schemes, including PPF and NSC, for the fourth straight quarter beginning January 1, 2024. "The rates of interest on various small savings schemes for the fourth quarter of FY 2024-25, starting from January 1, 2025, and ending on March 31, 2025, shall remain unchanged from those notified for the third quarter (October 1, 2024, to December 31, 2024) of FY 2024-25," said a finance ministry notification. As per the notification, deposits under the Sukanya Samriddhi scheme will attract an interest rate of 8.2 per cent, while the rate on a three-year term deposit remains at 7.1 per cent prevailing in the current quarter. The interest rates for popular Public Provident Fund (PPF) and post office savings deposit schemes too have been retained at 7.1 per cent and 4 per cent, respectively. The interest rate on the Kisan Vikas Patra will be 7.5 per cent, and the investments will mature in 115 months. The ..

Turkiye's central bank lowers key interest rate to 47.5%, 1st cut in 2 yrs

Turkiye's central bank lowered its key interest rate by 2.5 percentage points to 47.5 per cent on Thursday, carrying out its first rate cut in nearly two years as it tries to control soaring inflation. Citing slowing inflation, the bank's Monetary Policy Committee said it was reducing its one-week repo rate to 47.5 per cent from the current 50 per cent. The committee said in a statement that the overall inflation trend was flat in November and that indicators suggest it is likely to decline in December. Demand within the country was slowing, helping to reduce inflation, it said. Inflation in Turkey surged in recent years due to declining foreign reserves and President Recep Tayyip Erdogan's unconventional economic policy of lowering rates as a way to tame inflation which he later abandoned. Inflation stood at 47 per cent in November, after having peaked at 85 per cent in late 2022, although independent economists say the real rate is much higher than the official figures. Most ..

BoE keeps interest rates steady at 4.75%, but MPC members split on decision

Three of the BoE's nine-person Monetary Policy Committee - Deputy Governor Dave Ramsden and external members Swati Dhingra and Alan Taylor - voted for a quarter-point rate cut to 4.5 per cent

BoE to hold key rate despite slow economic growth, high inflation

The UK's central bank is set to keep interest rates on hold later Thursday as inflation has moved further above its target rate, even though the British economy is flatlining at best. The nine-member Monetary Policy Committee is widely expected to keep the bank's main interest rate unchanged at 4.75 per cent in the wake of figures showing inflation rising to 2.6 per cent, further above the target of 2 per cent. With price pressures elevated in the crucial services sector, which accounts for around 80 per cent of the UK economy, and wages strong, there are few indications that inflation will get back towards the target anytime soon. As a result, the rate-setting panel, which last cut its key rate in November, is set to take a cautious stance, as lower borrowing rates could stoke inflation. That's a disappointment for many struggling sectors in the UK economy that would be helped by lower interest rates in an environment of paltry growth in fact the British economy has contracted for

BOJ keeps rates steady; dissent signals potential tightening next year

As widely expected, the nine-member BOJ board voted 8-1 to keep its short-term policy rate unchanged at 0.25

Fed cuts key interest rates by 0.25%; reverse repo rate lowered to 4.25%

Analysts believe the largely expected adjustment is a bid by the Fed to nudge cash out of a facility that's widely viewed as a proxy for excessive liquidity in the financial system

Oil dips on demand concerns, focus on US Fed interest rate decision

Brent crude futures eased 32 cents to $73.59 a barrel at 0949 GMT, while US West Texas Intermediate crude was down 44 cents at $70.27 a barrel

High interest rates, fiscal consolidation slowing GDP growth: CRISIL

Some technical factors, such as net product taxes and the GDP deflator, have also disrupted GDP's trajectory

Pakistan's central bank cuts key policy rate by 200 basis points to 13%

Pakistan's central bank on Monday further reduced the key policy rate by 200 basis points (bps) to 13 per cent from 15 per cent amid improvement in inflation. The State Bank of Pakistan (SBP) announced that its Monetary Policy Committee (MPC) decided to cut the policy rate by 200 bps to 13 per cent, effective from December 17, 2024. It said that the decision was helped by the continued decline in food inflation as well as the phasing out of the impact of the hike in gas tariffs in November 2023. However, it added that core inflation, which stood at 9.7 per cent, was proving to be sticky, whereas inflation expectations of consumers and businesses remain volatile. The MPC also noted that the current account had remained in surplus for the third consecutive month in October 2024, which, amidst weak financial inflows and substantial official debt repayments, helped increase the foreign exchange of the central bank to around $12 billion. The committee also said global prices had remaine

Time to focus on export-led Indian miracle as US leans toward isolationism

It is surprising that India has not followed this path even though there have been plenty of examples of export-led economic miracles from the 1950s closer home

When will new RBI governor Sanjay Malhotra cut rates? Brokerages weigh in

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

GDP growth likely bottomed out; inflation to prevent December RBI rate cut

The CPI inflation for Q3 FY2025 is expected to overshoot the MPC's estimate of 4.8 per cent for the quarter by at least 60-70 bps

Govt. push for re-KYC, Banks seek governance reform, Interest rates, HSBC India, & Bima Sugam project

Government push for re-KYC completion Private banks seek governance reform Affordable interest rates a priority HSBC India expands amid market shift Bima Sugam project’s capital requirement rises

Banks need to make loans more affordable, says FM Nirmala Sitharaman

The Finance Minister also said that inflation is very volatile because of supply and demand constraints

US Oct retail inflation modestly up, may result in fewer interest rate cuts

The consumer price index rose 0.2% for the fourth straight month, the Labor Department said on Wednesday. In the 12 months through October

BFSI Summit: 'Service key to mobilising deposits, not just interest rates'

BFSI Summit: CEOs of prominent private banks say that interest rate hikes are not the key to attracting customers. Instead, the delivery of banking services and brand trust play more significant roles

Fed seen on track for 25-basis-point interest rate cuts next week, in Dec

The increase of 12,000 nonfarm payroll jobs last month was far short of the 113,000 economists had anticipated