techkenyot.com
techkenyot.com June 18, 2019


RBI cuts repo rate in first policy review under new governor

07 February 2019, 05:00 | Hattie Nash

RBI cuts repo rate in first policy review under new governor

RBI Policy MPC Cuts Benchmark Rate RBI Governor Emphasises Growth

The RBI's monetary policy xommittee (MPC) began its three-day meet on Tuesday to decide on key rates amid expectations that it may change its policy stance to "neutral" from "calibrated tightening" on low inflation footprint, even as a rate cut was ruled out by many experts. The MPC voted 4:2 in favour of the rate cut, while the decision to change policy stance was unanimous.

This was the first meeting of the monetary policy committee (MPC) under Shaktikanta Das who took over as the RBI governor in December after the sudden exit of Urjit Patel over differences with the Modi government.

The Reserve Bank of India headed by a new chief, Shaktikanta Das, will probably drop its hawkish bias on Thursday, the first step toward a possible interest-rate cut this year as inflation drifts lower and the economy slows.

The repo rate is the rate at which the Reserve Bank lends short-term money to the banks, while the reserve repo rate is the rate at which the central bank borrows money from commercial banks. While this "pre-election rate cut" might boost growth, the longer-term concerns for investors will be about the RBI's credibility as an inflation fighter, he added.

Taliban outline vision for post-war Afghanistan in Moscow peace talks
About 14,000 United States troops are still serving in Afghanistan and President Donald Trump plans to withdraw half of them soon. Speaking to Afghan TV channel TOLOnews, President Ghani said: "Those who have gathered in Moscow have no executive authority".

Das also downplayed the risk of inflation rising due to the forecast of fiscal slippage in last week's budget, and said the MPC will only look at the headline inflation number and ignore core inflation that has proven sticky. "It also signals a commitment to a symmetric policy to achieve its 4 per cent inflation target - a departure from the RBI's previous one-sided, conservative stance that aimed to keep inflation below the target."- Abhishek Gupta, Bloomberg Economics.

India's retail inflation declined from 3.4 per cent in October 2018 to 2.2 per cent in December, well below the bank's target of four percent.

The biggest take away from the policy on Thursday is that this marks the beginning of a fresh rate cut cycle after a prolonged period of rate pause and the MPC wants the markets to understand that.

The decision "restores growth maximisation as a secondary objective of the RBI".

Another threat to Trump: Prosecutors want inaugural committee's financial records
Sources told the New York Times that prosecutors are interested in potential money laundering and election fraud. The inauguration committee reported having only $2.8 million in the bank by October 2017.

Deviating from the practice of releasing the resolution of MPC in afternoon, the Reserve Bank of India (RBI) uploaded the policy statement it on its website at 11.45 am on February 7.

"Das has delivered what the Modi government was hoping for", said Mark Williams, chief Asia economist at Capital Economics Ltd.in London. "Going by the guidance, there is room for a further rate cut". The rupee weakened to 71.69 to the dollar immediately after the announcement but did strengthen to 71.42 soon.

The National Stock Exchange of India (NSE) Nifty was up 0.04% at 11068.05 while the ten-year benchmark government bond yield fell to 7.51% from Wednesday's close of 7.56%.

Spotify is embracing podcasting with the purchase of two podcast giants
The amount Spotify is looking to spend on podcast companies is greater than a year of for the entire podcasting market. Anchor will bring its platform of tools for podcast creators and its established and rapidly growing creator base.



Other News

Trending Now

Is Ranked Play coming to Apex Legends?
A for Battlefield V , EA sold 7.3 million units, which is around 1 million less than the publisher was anticipating. During its latest financial call, EA stated that a new game is coming, and will bring a "new twist" to the shooter.

Pope Francis admits priests, bishops sexually abused nuns
The nuns recently asked the chief minister of Kerala to intervene on their behalf, after they say church officials ordered them to leave the state.

I was not consulted on Syria pullout, CENTCOM chief Votel says
And when he addressed the Senate Armed Services Committee, Votel warned that an ISIS resurgence is possible. And within a year, USA military commanders told the IG, ISIS would be resurgent in Syria.

Lady Gaga and Bradley Cooper to perform at Oscars
Additionally, the Oscars is teasing a performance of " The Place Where Lost Things Go " by a " surprise special guest ". This was followed by a few minutes of a musical treat wherein they sung their uber-popular A Star Is Born hit Shallow .

Wizards’ John Wall out 12 months after rupturing left Achilles tendon
He appeared in 32 games this year, averaging 20.7 points and 8.7 assists, before going down with a heel injury in late December. Wall has had three knee surgeries with his first dating back to September 2002 when he missed the first 33 games of the season.

Women's brains appear 'years younger' than men's, says new study
This can cause problems later in life and scientists hope to one day slow it down with state-of-the-art drugs or brain therapy. The team trained an AI algorithm to guess people's ages based on the amount of oxygen and glucose flowing through their brain.

At least five die in auto bombing at Mogadishu mall
Al-Shabaab jihadists seeking to topple the internationally-backed government regularly carry out attacks in the Somali capital . Last month, the terrorist organization killed 21 people in a hotel in Nairobi, Kenya.

James set to return for Lakers versus Pacers
With James' return, the Lakers are looking to make significant additions for a late-season push. I still made the free throws. "If you let that bother you, you're in the wrong sport".

Brexit agreement remains best deal possible: Leo Varadkar
Downing Street said it was a question for Mr Tusk "whether he considers the use of that kind of language helpful". It didn't take long for British and Northern Irish politicians to react to his comments.

Mobile hires former FCC commissioner Clyburn to help lobby for Sprint merger
Despite being the fastest-growing carrier in recent years, T-Mobile rounded out 2018 with 80 million subscribers. We believe this merger makes consumers better off, and we're willing to put our money where our mouth is.