Bankers urged the Reserve Bank of India (RBI) to reduce the cash reserve ratio (CRR) by 50 basis points in its Annual Policy on May 3. Bankers want the central bank to reduce CRR as such a move would release cash into the system and ease liquidity pressure. CRR is the portion of deposits that banks have to set aside
Tag: Cash-Reserve Ratio
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RBI Governor supports moving towards panel structure
Reserve Bank of India Governor Duvvuri Subbarao said India must move towards a monetary policy committee structure. Subbarao said this in reply to a question following a speech at the Bank of Mauritius, which has such a committee in place. The governor said RBI must have more independence in order to have a monetary policy committee
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Banks may not cut lending rates soon
Banks in the country may not be able to cut lending rates soon in response to the 25 basis point reduction in the policy repo rate by the Reserve Bank of India (RBI) in its monetary policy review on Mach 19. Banks may not be able to reduce lending rate because doing so would reduce their net interest margin when deposit rate is high. Banks cannot reduce deposit rate at a time when they are trying to attract more depo
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Some analysts expect RBI to cut policy rate
The slowdown in economic growth and the government's commitment to reign in fiscal deficit may prompt Reserve Bank of India (RBI) to cut policy repo rate by 25 basis points in its monetary policy review in mid-March. The central bank may partly base its decision on the government's efforts to deliver fiscal consolidation as exemplified by the progress in 2012-13 and presented in th
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Govt’s fiscal moves may influence RBI rate decision
In an interview to a news agency, Finance Minister P Chidambaram remarked that Reserve Bank of India (RBI) would take a decision on reducing policy rate after taking into consideration the fiscal moves of government. On March 19, the central bank would release mid-quarter review of monetary policy. Shifting its focus from infla
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RBI has limited room for policy easing
In an interview to a leading media, Reserve Bank of India (RBI) Governor D Subbarao remarked that the roon for monetary easing is limited over the next few months because of the outlook for inflation and outlook for growth. He said the central bank would take into account the fiscal consolidation measures and deficit projections by the finance minister in the coming Budget to decide on t
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RBI cuts repo rate to support economic growth
Reserve Bank of India (RBI) reduced the policy repo rate by 25 basis points from 8.0 per cent to 7.75 per cent with immediate effect in its third quarter review of monetary policy 2012-13. In order to infuse liquidity into the banking system, the central bank also reduced the cash reserve ratio (CRR) of scheduled banks by 25 basis points from 4.25 per
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Some bankers expect RBI to cut CRR to ease liquidity strain
Some bankers expect Reserve Bank of India either to cut cash reserve ratio (CRR) in the third-quarter monetary-policy review on January 29 or conduct open market operations (OMO) to overcome liquidity crunch in the banking system. It is learnt that slow growth in deposit rate, back-to-back auction of government bonds have strained liquidity in the banking system. According to reports, main
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Restructuring of loans to discoms is not a permanent solution
In a freewheeling interview with Rahul Kamat, M V Tanksale, Chairman and Managing Director, Central Bank of India, says that although discoms are going through a rough phase