Reserve Bank of India - Credit Policy 2008-09 at FinGad.com

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Reserve Bank of India - Credit Policy 2008-09

Categorie: Emerging Markets
Submitted 6 months ago by

Narasimhan , Owner at Krish Systems

Reserve Bank of India released its assessment of Indian economy and credit policy. When looks at the economic numbers it is clear that higher monetary expansion and marginally lower growth in FY 07-08 are being focused by the RBI as one of the reasons for the inflation. RBI has signaled by raising the cash reserve ratio to reduce the excess liquidity in system. Thankfully it has resorted to increase in repo rates that would have hardened the interest rates. Credit policy announcement has number of welcome measures as also good data on sector wise growth. The data reveals that the gradual lowering of interest cost in the corporate profits accompanied by decline in the rate of sales growth in FY 08. Higher capital formation and investment spending have kept the pressure on supplies. The international crude prices have led to additional burden on the oil marketing companies although the Indian Government is funding their losses. The invisibles in balance payment are accounting for $ 50.5 Billion up from US $ 36.3 Billion in the April – December period. Remittance has jumped to $ 28.8 Billion compared to $ 202. Billion a year ago and software exports increased to 27.5 Billion compared to $ 21.8 Bill... More...

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