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Category: Fiscal & Monetary Policies


CRR VS SLR : ROUND II RBI VS SBI

Filed under: Fiscal & Monetary Policies — 3 Comments
October 31, 2012

State Bank of India chairman Pratip Chaudhuri, yet again, took on the Reserve Bank of India (RBI), saying saying CRR is a “waste” for the economy and successive interest rate cuts by central bank have failed to contain inflation.

The CEO caused a flutter in the banking community by demanding the abolition of the Cash Reserve Ratio (CRR) in SBI vs RBI round II. RBI did promptly appointed a committee to look at this issue. The reserve ratios, CRR and SLR (Statutory Liquidity Reserve), are an important feature of Indian banking regulation. View full article »

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Emerging Economies and Currencies

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September 30, 2012

The combined output of emerging-market economies now accounts for more

than half of world GDP and energy consumption. The emerging countries also hold 70% of the world’s foreign-exchange reserves. As a result, rich countries no longer dominate either the global economy or the global economic-policy agenda. Emerging countries’ global integration, demand for View full article »

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THE TWO CENTRAL BANKERS – Shared in many B schools

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September 1, 2012

 

Economy always passes in different phases could be classified as the boom phase, the downside or the burst  phase . Central bankers are the key players in the economy with limited power in their hand.

Alans Greenspan ( former Chairman of the Federal Reserve)  and YV Reddy ( Former Chairman of RBI) were credited with far greater power then they ever had and with responsibility for outcomes largely beyond their control. Central bankers actually have  very limited tools and hence limited powers.

Reddy in India understood View full article »

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Price of Oil :- Reality check between Crude, Petrol and USD/INR

Filed under: Fiscal & Monetary Policies — 1 Comment
June 1, 2012

Yesterday was an event full day despite the nationwide strike by the NDA and other political parties against the petrol price hike by the ruling government. The losses of yesterday India closed yet to be ascertained, but definitely a day close loss in the Indian economy would be much more than the oil companies made it. The Indian economy grew at 5.3% in the fourth quarter of the last fiscal. Impacting the expectation of India growth story of growing more than 7% .

Bit surprised to see lot of statements has been made towards the RBI on account of tight monetary policy View full article »

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Yield Curve Basics

Filed under: Fiscal & Monetary Policies — 1 Comment
May 10, 2012

I do not know why but somebody wanted me to define some basics on Yield spreads, that whether Yield spreads can judge the risk environment in an economy ?

Yield spreads are good tools to judge the risk environment in an economy a lower yield spread means that the issuer of debt is in a situation to demand loans at a lower spread above the yield of government security which in turn shows the presence of ample liquidity.

As far as economic growth is concerned a lower yield spread indicates greater amount of liquidity available for growth View full article »

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The World Eye’s on India : Crucial Budget 2012

Filed under: Economies, Fiscal & Monetary Policies — Leave a comment
March 16, 2012

This is the most event full day in the country,continuing from my last post the India Budget 2012 , the expectations are high because the world biggest democracy has more challenges on every front be it from the basic amenities like toilets. India has more cell phones than toilets Yesterday the Economic survey came out and The survey estimates that GDP will grow 7.6% in 2012-13 and expand at 8.6% in the year after that but the pace is dependable on reform to be optimistic.

Inflation remains the key : Even the survey projected danger of high inflation is not yet over and the government should work to gently bring it down below 5.Income distribution is the another challenge. View full article »

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