Page 10 - Interest Rate Hike

Increased repo rate by RBI big dampener for auto industry, says FADA

The hike in key interest rate by RBI is a big dampener for the automobile industry particularly for the price sensitive entry-level two-wheelers and passenger vehicles segments, Federation of Automotive Dealers Associations said on Friday. The Reserve Bank of India (RBI) on Friday raised the key interest rate by 50 basis points, the fourth straight increase since May with more hikes expected to rein in inflation. The Monetary Policy Committee (MPC), comprising three members from the RBI and three external experts, raised the key lending rate or the repo rate to 5.90 per cent - the highest since April 2019. "It is definitely a big dampener for the auto industry especially for both, entry level two-wheeler and passenger vehicle segment where customers are extremely sensitive to any price hike," Federation of Automotive Dealers Associations (FADA) President Manish Raj Singhania said in a statement. Since May 2022, almost 2 per cent rates have been increased, with vehicle loan rates al

Rate sensitive shares bounce back after RBI hikes rate; Nifty Bank gains 1%

Kotak Mahindra Bank, HDFC Bank, Axis Bank, State Bank of India, HDFC, ICICI Bank, SBI Life Insurance and SBI Cards from the Nifty Financial index gained up to 2 per cent each.

The challenge of monetary tightening

Soaring inflation has spurred the European Central Bank and the Bank of England to do the same, though many economists still accuse all three monetary authorities of being behind the curve

Banks increase interest rates on bulk deposits as liquidity tightens

Loan, deposit growth gap at 10-year high

Some small savings schemes see up to 30-basis point hike for Q3 of FY23

National Savings Certificate, Public Provident Fund rate kept unchanged

Rupee at another low of 81.94 per dollar as US Fed talks up rate hikes

RBI may have sold more than $1 bln in FX mkt, prevented rupee from breaching 82/$1

Plunging global markets trigger new intervention warnings in Asia

South Korea joined a growing list of interventions on Wednesday, with the central bank saying it will buy as much as $2.1 billion worth of sovereign debt.

ECB policymakers may put hike of 75 bps on table at October meeting

The ECB lifted interest rates by a combined 125 bps at its past two meetings, the fastest pace of policy tightening on record, but inflation may still be months from its peak

Aggressive rate hikes may be counterproductive in short run: Emkay Wealth

Aggressive rate hikes by central banks globally to tame soaring inflation may prove counterproductive in the short run, Emkay Wealth Management said on Wednesday. Underlining that geopolitical tensions, soaring crude oil prices and worries around recession in the developed countries are some of the major risks threatening the markets, Emkay Wealth Management however said India fears no major risks. However, there are risks related to slowing of exports and currency depreciation, the company said during a webinar. The Indian rupee plunged to an all-time low of Rs 81.93 per dollar on Wednesday. "Inflation has become a concern for most major economies, and central banks are resorting to aggressive rate hikes. This move could push up inflationary pressures, proving counterproductive in the short run. The dollar index and crude are the two key indicators to watch out for in the next few quarters," Joseph K Thomas, Head of Research, Emkay Wealth Management said. Central banks across th

Equities, gold, FDs: Where should you invest as global headwinds blow?

The sharp reversal in the interest rate regime by global central banks and high inflation has eroded returns from equities. Where should an investor, with a surplus investable amount, put their money?

Monetary policy preview: Front-loading rate hikes for macro stability

The current account deficit remains uncomfortably high as India's growth momentum outpaces the rest of the world.

Rupee ends beyond 81 against dollar for the first time; lags EM peers

RBI may have sold around $1 bn, but experts see pace of intervention declining

Sterling tumbles nearly 5% to all-time low on tax reforms, shows data

The currency dived as much as 4.85 per cent to an unprecedented $1.0327, extending a 3.61 per cent dive from Friday, when finance minister Kwasi Kwarteng unleashed historic tax cuts

RBI set for fourth straight rate hike to quell inflation, say experts

The Reserve Bank of India (RBI) may take cues from its global counterparts, including the US Federal Reserve, to raise interest rate for the fourth time in a row on Friday to tame stubborn inflation. The RBI, which has since May raised the short-term lending rate (repo) by 140 basis points (bps), may again go for a 50-bps increase to take it to a three-year high of 5.9 per cent, say experts. The central bank had raised the repo rate by 40 bps in May and 50 bps each in June and August. The present rate is 5.4 per cent. The consumer price index (CPI) based retail inflation, which had started showing signs of moderation since May, has again firmed up to 7 per cent in August. The RBI takes into account retail inflation while framing its bi-monthly monetary policy. The RBI Governor-headed Monetary Policy Committee (MPC) is scheduled to start its three-day deliberations on Wednesday. The decision of the rate-setting panel would be announced on Friday (September 30). The US Fed delivered

Gold prices hit two-year low on dollar strength, Fed rate concerns

Spot gold was down 1.7% at $1,642.79 per ounce by 1058 GMT and was heading for its second straight weekly decline, down 1.8%. U.S. gold futures GCv1 fell 0.5% to $1,672.10.

Sensex sheds 1,021 pts on Friday, ends week with 700-pt drop: Here's why

Stock markets: Today's decline was the third consecutive fall for the two indices after US Fed's 75 bps rate hike on Wednesday night

India OIS curve may steepen on overcooked rate hike bets: BofA Securities

BofA expects the Reserve Bank of India to raise rates by 25-35 basis on Sept. 30 and reckons the policy rate will reach 6.5% by end-2023, much later than what some investors are expecting

Gold risks collapse into bear market as Federal Reserve targets inflation

Bullion's extended retreat -- with prices on course for a sixth consecutive monthly drop in September -- has driven prices close to bear-market territory

Turkish lira hits record low against dollar before central bank meeting

Turkey's currency fell to a record low against the dollar before a central bank meeting on interest rates on Thursday. The lira traded at a low of 18.38 against the dollar, past the previous record low of 18.36 in December, before recovering to about 18.36. Turkey has been following President Recep Tayyip Erdogan's unorthodox belief that high interest rates cause high inflation while much of the world is increasing their policy rates to combat inflation. The Turkish central bank last month lowered its benchmark rate by 100 points to 13 per cent. Official statistics released earlier in September showed annual inflation at 80.21 per cent. Last year, the currency kept hitting record lows as the central bank lowered interest rates from 19 per cent. When it finally hit 18.36 against the dollar, Erdogan announced extraordinary measures that he claimed would safeguard the lira. The government encouraged people to swap their dollars for the lira and place them in a deposit account that wo

Bank of England poised for another big interest rate hike amid inflation

Britain's central bank is under pressure make another big interest rate hike Thursday, with inflation outpacing other major economies but the U.S. Federal Reserve and other banks acting more aggressively to get prices under control. The Bank of England hiked its benchmark rate last month by half a percentage point to 1.75%, the biggest increase in 27 years, and it's expected to at least match that in its latest decision, which was delayed a week during the mourning period for Queen Elizabeth II. Faced with a slumping currency, tight labor market and inflation near its highest in four decades, officials may feel the need to act more aggressively as rising food and energy prices fuel a cost-of-living crisis that is considered the worst in a generation. But giving pause could be economic relief measures from new Prime Minister Liz Truss' government that are expected to ease inflation short term. The meeting will tell us not only how worried policymakers are about the slide in sterling