Rbi releases fourth bi-monthly monetary policy statement 2016-17

The Reserve Bank of India (RBI) on 4 October 2016 released the fourth Bi-Monthly Monetary Policy Statement 2016-17. Electricity and magnetism worksheets high school The key announcement under the policy was the interest cut of 25 basis points. Hp gas online booking mobile number This move may lead to banks in lowering EMIs for housing, car loan and corporate borrowers.

This policy decision was not only RBI Governor Urjit Patel’s maiden policy announcement but was also the first to be announced by the newly constituted Monetary Policy Committee (MPC). Gas prices going up in nj All the six members of MPC unanimously decided to cut repo rate by 0.25 per cent; bring in to a nearly six-year low of 6.25 per cent. Electricity for kids This was also the first interest rate cut in last six months.

According to the monetary policy statement, the decision to cut interest rates is consistent with the aim of achieving a midterm inflation target of 4 percent within a band of plus or minus 2 percent.

• Repo Rate: The policy repo rate under the liquidity adjustment facility (LAF) was reduced by 25 basis points from 6.5 per cent to 6.25 per cent with immediate effect.

The decision of the MPC is consistent with an accommodative stance of monetary policy in consonance with the objective of achieving consumer price index (CPI) inflation at 5 per cent by Q4 of 2016-17 and the medium-term target of 4 per cent within a band of +/- 2 per cent, while supporting growth. 4 gas laws The main considerations underlying the decision are set out in the statement below.

• Risks in the form of BREXIT, banking stress in Europe, rebalancing of debt-fuelled growth in China, rising protectionism and diminishing confidence in monetary policy have slanted the outlook to the downside.

• World trade volume has contracted sharper than expected in the first half of 2016, and the outlook has worsened with the recent falling off of imports by Advanced Economies (AEs) from Emerging Market Economies (EMEs). Gas zone edenvale Inflation remains subdued in AEs and has started to edge down in EMEs.

• International financial markets were overwhelmed by the BREXIT vote in Q2, with equity markets losing valuations worldwide, currencies plunging and turning volatile, and investors rushing for safe havens. Gas 76 Markets, however, recovered quickly and reclaimed lost ground in Q3, with a return of risk appetite propelling capital flows back into EMEs.

• Crude prices rose to a recent peak in Q2 of 2016, mostly on supply disruption in various parts of the world, and again in late September as the OPEC announced intentions of cutting back on supply; but, the upturn has been curbed by higher inventories.

• Agriculture: The outlook for agricultural activity has brightened as the South West monsoon ended the season with a cumulative deficit of only 3 per cent below the long period average, with 85 per cent of the country’s geographical area having received normal to excess precipitation.

• Kharif: Kharif sowing has surpassed last year’s acreage, barring cotton, sugarcane and jute and mesta. Electricity quizlet Accordingly, the first advance 2 estimates of kharif food grains production for 2016-17 by the Ministry of Agriculture have been placed at a record level, and higher than the target set for the year.

• Industrial sector: The industrial sector, by contrast, suffered a manufacturing-driven contraction in early fiscal year Q2, after a sequential deceleration in gross value added in Q1. 1 electricity unit is equal to how many kwh Even after trimming the statistical effects of the lumpy and order-driven contraction of insulated rubber cables, industrial production as measured by the index of industrial production (IIP) turned out to be slower than a year ago.

• Steel: In August, steel production rose to a 37-month high and cement production maintained momentum – auguring well for construction activity – even though the output of core industries as a whole was weighed down by a decline in the production of coal, crude oil and natural gas and deceleration in refinery products and electricity generation.

Nonetheless, business expectations polled in the Reserve Bank’s industrial outlook survey and by other agencies remain expansionary in Q2 and Q3.

• Roads, Railways And Inland Waterways: The strong public investment in roads, railways and inland waterways, the recent efforts to unclog cash flows in large projects under arbitration, and the boost to spending from the 7th Pay Commission’s award, should improve the industrial outlook.

• Services Sector: The acceleration in the pace of activity in Q1 appears to have been sustained. Electricity 220 volts wiring An increasing number of high frequency indicators are moving into positive territory, construction is boosted by policy initiatives, and public administration, defence and other services will be supported by the pay commission award.

• Retail inflation: Measured by the headline CPI had been elevated by a sharp pick-up in the momentum of food inflation overwhelming favourable base effects during April-July. J gastroenterology impact factor In August, however, the momentum of food inflation turned negative and surprised expectations; consequently, base effects in that month came into full play and pulled down headline inflation to an intra-year low. 7 gas station Fuel inflation has moderated steadily through the year so far. Gas dryer vs electric dryer Inflation excluding food and fuel (including petrol and diesel embedded in transportation) has been sticky around 5 per cent, mainly in respect to education, medical and personal care services.

• Liquidity conditions: It remained comfortable in Q3, with the Reserve Bank absorbing liquidity on a net basis through variable rate reverse repo auctions of varying tenors. Gsa 2016 catalog Liquidity was injected through open market purchases of 200 billion rupees in line with the system’s requirements. Gas in dogs As a result, the Weighted Average Call Money Rate (WACR) remained tightly aligned with the policy repo rate and, in fact, traded with a soft bias. Gas out game rules Interest rates on commercial paper (CPs) and certificates of deposit (CD) also eased.

• External Sector: Merchandise exports contracted in the first two months of Q2. Gas x strips instructions Subdued domestic demand was, however, reflected in a faster contraction in imports. La gasolina reggaeton explosion Moreover, the still soft crude prices pared off a fifth of the oil import bill and gold import volume slumped to a fifth of its volume a year ago. Electricity production in india As a result of the same, the merchandise trade deficit narrowed by 10 billion US dollars in April-August on a year-on-year basis.

• Foreign Direct Investment: The pace of foreign direct investment slowed compared to a year ago, portfolio flows were stronger after the BREXIT vote, galvanised by a search for returns in an expanding universe of negative yields. Wd gaster x reader The level of foreign exchange reserves rose to 372 billion US dollars by 30 September 2016 – an all-time high.

• Sharp drop in inflation reflects a downward shift in the momentum of food inflation, which holds the key to future inflation outcomes, rather than merely the statistical effects of a favourable base effect.