With the latest rate cut, the Repo Rate now stands at 5.5 percent which was 6 percent earlier.

On addition, the Reserve Bank of India has cut the Cash Reserve Ratio (CRR) by 100 basis points, bringing it down to 3 percent from 4 percent earlier.

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In another note, the Reserve Bank of India’s MPC (MONETARY POLICY COMMITTEE) reduced the inflation projection to 3.7 percent from 4 percent for FY26, while the GDP growth projection for FY26 remained unchanged at 6.5 percent.

Gold finance stocks were in the news today after RBI Governor Mr. Sanjay Malhotra stated that the loan-to-value (LTV) for gold loans below INR 2.5 lakh is set to be revised to 85 percent from 75 percent, giving Non-Banking Financial Companies greater lending flexibility.

HERE IS THE SUMMARY –

• REPO RATE = 5.5%
• CASH RESERVE RATIO = 3%
• INFLATION projection (FY26) = 3.7%
• GDP projection (FY26) = 6.5%
• GOLD LOAN (below 2.5 lakh) = 85%

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

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Benchmark rates in the US currently sit at 3.25 per cent after the latest Federal Reserve Interest Rate Hike.

This is the 3rd successive interest rate hike by the Fed this year rate and policy-makers at the central bank are signalling they aren’t done yet (officials forecasted that they will lift the rate to roughly 4.4 per cent by year’s end).

Let’s understand how this interest rate hike will influence (the US) Economy,

Federal Reserve Hike Interest Rate

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An increase in interest rates will slow down investment and interest-sensitive consumption in the US.

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By slowing down this interest-sensitive investment and consumption, the Fed intends to bring down overall demand in the economy.

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By bringing down overall demand in the economy, the Fed intends to slow down inflation (which is the biggest for the US now) or price rise.

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A slowdown in the US economy will bring a slowdown in other economies as well since the US is one of the biggest importers of goods and services from countries across the world.

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Exports of countries such as India (maybe IT-related businesses) will be badly impacted because of a sustained economic slowdown or probably recession in the US.

Let’s now understand how this influences Stock Market,

Federal Reserve Hike Interest Rate

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An interest rate hike by the Feb also means increasing the cost of money in the US.

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Foreign Investors (FIIs) based in the US will therefore demand a higher return from their equity investments (countries such as India).

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Many of them will tweak some of their cash out of these markets by selling their investments.

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This will create selling pressure in equity markets, like ours.

Also Read: Nifty prediction for September 2022

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I (Vishal Dalwadi) or (FinBlab) do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

The post Federal Reserve Interest Rate Hike – How It Will Impact appeared first on Upcoming ipos: Latest news on stocks, economy & finance.

What to Expect From RBI MONETARY POLICY

As the Reserve Bank of India (RBI) is all set to meet for its bi-monthly Monetary Policy in the first week of August 2017, the market participants have been wondering if RBI chooses to cut the benchmark interest rate. There seem to be numerous good factors for the interest rate cut.

1. India CPI (Consumer Price Index) inflation data came down to 1.5% for Jun’17.
2. Food CPI came down to -2.12% in June.
3. The IIP (Index of Industrial Production) data also came down – mainly due to decline in mining activities.
4. Core CPI (ex-commodities) came in at 4% YoY.
5. Indian Rupee also appreciated since the beginning of the year.
6. Monsoon performance has been very good. Average or above average monsoon rainfall in the country may further bring down the food prices.
7. GST rates were neutral to the inflation outcome.
8. IMF (International Monetary Fund) expects India’s economy to grow at a higher level of 7.2%.

What RBI Did In Its Last Policy

RBI in its last policy meet (June 2017) had left the Repo rate unchanged at 6.25%, Reverse repo rate at 6%. Here are the rates as per RBI’s second bi-monthly Monetary Policy Statement for 2017-18 announced on 7th June 2017.

FinBlab View –

The above mention numbers and data clearly suggest that there may be a rate cut in the coming Bi-monthly Monetary Policy of RBI on 2nd of August. But still, the FinBlab view is that RBI Governer will remain silent in the up-coming policy and there is a low probability for a rate cut.

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

The post RBI MONETARY POLICY: WILL THERE BE A RATE-CUT THIS TIME? appeared first on Upcoming ipos: Latest news on stocks, economy & finance.