Demonetisation has also inevitably generated severe liquidity management issues for RBI
On Wednesday, it surprised many with a status quo on policy, premised on upside risk to Q4 inflation and limited transient growth drag owing to demonetisation
As a result of demonetisation, bankers believe there could be some pressure on asset quality, especially accounts
The yield on govt notes due September 2026 jumped 21 bps to 6.41% in Mumbai, prices from RBI's trading system show
RBI gives more weight to upside risks to inflation
Ficci president says that at this juncture, a 50 bps point cut in the repo rate would have provided the needed boost to the flagging industrial economy
It sees the near-term risks in cash-intensive sectors and unorganised sector; also sees aggregate demand compression associated with adverse wealth effects
The present yields on the 10-year bond, which closed at 6.20% on Tuesday, have factored in a sure rate cut
The report further said that though the RBI is expected to cut 25 bps each on February 7 and April
The central bank got room to effect 25 bps rate cut due to a change in its stance on neutral real rate and the timeframe for achieving the inflation target
Chief executives also demanded banks pass on the benefits of the reduction in rates, which are at a six-year low
Interview with RBI Governor
Encouraged by the rate cut, the rate sensitive sectors such as real estate and automobiles are now expecting a bumper festival sales season
Outlook for agricultural activity has brightened considerably, says the policy document
In his first RBI monetary policy, Governor Urjit Patel cut rate by 25 bps to 6.25%
Patel makes it a point to meet country's influential economists and industry big-wigs before announcing the monetary policy.
August retail inflation eased to a five-month low of 5.05% but WPI inflation climbed to a two-year high of 3.74%
Better monsoon rains after two back-to-back droughts and lingering weaknesses in manufacturing have again opened the case for aggressive rate cuts
The rupee is likely to remain stable in the near term, with near-term forward rates also having fallen
RBI took this step to ensure adequate cash conditions in the banking system