Reserve Bank of India

Reserve Bank of India’s First Bi-Monthly Monetary Policy Review of Fiscal 2016/17

April 5, 2016

The main policy interest rate, the repo rate, was cut 25 basis points to 6.5%, lowest since 2011, while the reverse repo rate was hiked by 25 bps to 6.0%.  The narrowing of the corridor between the rates was one of several actions intended to strengthen the pass-through of changes in central bank policy rates […] More

Reserve Bank of India Leaves Monetary Policy Settings Unchanged

February 2, 2016

The key RBI repo rate of 6.75% as well as the 5.75% reverse repo rate and 4.0% reserve requirement were not cut further after the first central bank policy meeting of 2016. No changes had been anticipated, and none occurred at the prior meeting in December.  A statement from officials runs down the litany of […] More

Reserve Bank of India

December 1, 2015

Monetary policy was not changed at this week’s review.  The repo and reverse repos remain at 6.75% and 5.75%.  Policy easing was front-loaded earlier this year, with cuts of 25 basis points in January, May and June, followed with a greater-than-anticipated 50 bps in September.  A released statement makes these points: Front-loaded monetary support was […] More

A Front-Loaded 50-Basis Point Interest Rate Cut in India

September 29, 2015

The Reserve Bank of India’s repo and reserve repo rates were each reduced by 50 basis points to 6.75% and 5.75%.  The size of the cut was twice as much as expected and follows three 25-basis point reductions during the first half of calendar 2015.  A statement from RBI Governor Raghuram Rajan characterizes policy as […] More

Reserve Bank of India Keeps Policy Unchanged after Latest Bi-Monthly Review

August 4, 2015

There had been three cuts earlier this year (January, March and June) of 25 basis points in the repo rate (now 7.25%) and reverse repo (6.25%), but as expected, that didn’t happen again, nor was the 4% bank reserve requirement cut either.  Notably, CPI inflation rose sharply to 5.4%, a 9-month high.  Today’s statement observes […] More

Another Easing of Monetary Policy in India

June 2, 2015

Today’s 25-basis point reductions in the Reserve Bank of India’s repo and reverse repo rates to 7.25% and 6.25% constitute the third easing move of 2015, matching in size similar cuts in January and March.  The latest easing did not surprise analysts in its timing.  Although observing continuing potential upside risks to inflation that bear […] More

Reserve Bank of India: No Change in Interest Rates or Bank Reserve Requirements

April 7, 2015

The framework of monetary policy changed in January, with the establishment then of an inflation reduction target to be followed by an inflation containment target once 4% is attained around March 2018.  The targets were endorsed by the government as well as the central bank.  In conjunction with the shift in January, policy was allowed […] More

Post-Easter Session Sees Equities and Aussie Dollar Rise

April 7, 2015

Following the advance in the Dow on Monday, the return of markets that had been closed for Easter saw share prices advance 2.2% in China, 1.3% in Japan, 0.8% in Hong Kong and Indonesia, 0.5% in Australia and 0.4% in Singapore, Taiwan and New Zealand.  European stocks have thus far advanced by 1.5% in Great […] More

Reserve Bank of India Cuts Rates between Scheduled Meetings

March 4, 2015

RBI Governor Rajan released a statement announcing a new monetary policy framework oriented around a single target of 4% CPI inflation give or take two percentage points.  The statement also informed markets about a 25-basis point cut of the RBI repo rate to 7.5%.  A similar cut on January 15 (also not coinciding with a […] More

Reserve Bank of India

February 3, 2015

India’s is one of the central banks that already had cut interest rates this year in response to the disinflationary impact of the price of oil and other key commodities.  See my earlier review of the 25-basis point cut on January 15 following an unscheduled meeting of Reserve Bank of India policymakers.  Today was the […] More