Reserve Bank of India

Reserve Bank of India Policymakers Decide to Wait but Remain Vigilant about Inflation

December 20, 2013

This week’s mid-quarter policy review left the repo rate at 7.75%, the reverse repo at 6.75% and the cash reserve requirement at 6.75%.  The decision not to tight further was a difficult one.  In a world of disinflation, India sticks out as one place where excessive inflation remains stubbornly entrenched. There are indications that vegetable […] More

Reserve Bank of India

October 30, 2013

Tuesday’s meeting ended with an announced hike of India’s repo rate to 7.75% and reverse repo to 6.75%.  Similarly sized hikes were done on September 20th.  At the same time, the marginal standing facility rate was cut 25 bps to 8.75%.  These changes restore operational responsibility for monetary policy to the repo and reverse repo […] More

Reserve Bank of India Opens a New Box of Tools

September 20, 2013

2013 has been a difficult year for the Indian rupee, which despite some appreciation in September is down over 13% against the dollar since end-2012.  The exchange rate has been hit by elevated inflation, disappointing growth, a chronic current account deficit equal to about 4.5% of GDP, and rising global long-term interest rates.  A number […] More

Central Bank Surprises in India and Australia

July 16, 2013

Published minutes from the Reserve Bank of Australia reflected a tilt away from additional monetary easing.  At the policy board meeting earlier this month, officials observed that past rate cuts were positively impacting housing and other aspects of the economy and believed that this support had not yet run its course.  Aussie dollar depreciation was […] More

Reserve Bank of India Passes in June

June 17, 2013

The RBI already had cut its repo and reverse repo rates three times this year in reductions of 25 basis points at its January, March and May meetings.  An earlier easing of 50 bps was implemented 14 months ago in April 2012.  The key lending and borrowing rates are now 7.25% and 6.25%, and the […] More

Fourth Central Bank Rate Cut in India

May 3, 2013

Officials at the Reserve Bank of India followed up on cuts in its repo rate of 50 basis points in April 2012, 25 bps in January 2013, and 25 bps in March 2013 with a fourth reduction today, this time again by 25 basis points to 7.25%.  The action had been anticipated but was tempered […] More

India: Third Interest Rate Cut of the Cycle

March 19, 2013

A 25-basis point rate cut of the Reserve Bank of India’s repo rate to 7.5% and reverse repo to 6.5% announced today follows up on moves in April 2012 of 50 basis points and January 2013 of 25 basis points.  Thirteen previous increases administered in 2010 and 2011 had lifted the repo rate to 8.5% […] More

Uncertain Cypriot Situation Still Overhanging Markets

March 19, 2013

Despite talk of fine-tuning the proposed Cypriot levy on bank deposits, uncertainty in this area and the risk of copy-cat actions elsewhere in the euro area continue to worry investors worldwide.  A hope exists that small depositors may be exempted, but then big deposits would be penalized more heavily than proposed initially.  The Cypriot parliament […] More

India Gets Easier Monetary Policy Stance

January 29, 2013

Officials at the Reserve Bank of India Cut the central bank’s repo and reverse repo rates by 25 basis points each to 7.75% and 6.75%.  This was the second round of cuts.  The first was made last April and amounted to 50 basis points.  Previously, the repo rate had been raised by 200 basis points […] More

Japanese Government on Defensive over Yen Policy

January 29, 2013

Foreign governments continue to depict the actions and remarks of the new Japanese government as a breach of the rule against competitive devaluation.  The yen recovered 0.4% against the dollar overnight.  The U.S. currency also lost 0.3% against the Australian dollar and sterling and 0.2% versus the Swiss franc and kiwi.  The dollar has risen […] More

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