RBI may hold on policy stance amid high inflation: Experts

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eserve Bank is unlikely to soften its monetary stance in its policy review later this month due to high inflation even though sluggishness in industrial output growth for May calls for cut in policy rates, say experts.

The Reserve Bank of India (RBI) is guided by inflationary expectations. Inflation is expected to remain high, HDFC Bank chief economist Abheek Barua said.

"I do not think there will be either infusion of liquidity or cut in policy rates by the RBI in its quarterly policy review," he said.

Crisil chief economist Deepak Joshi said, "Monetary policy is not going to be changed. I think RBI will keep it on hold. Going by the assessment of the economy, I think there will not be any rate cut."

The index of industrial production (IIP)-- gauge of industrial activity in terms of production -- showed a just 2.4% growth in May. It was much below than 6.2% growth during the same month a year earlier.

However, IIP numbers for May are better than the previous month's 0.9% contraction.

HSBC Global Research said though IIP picked up on an improved sequential momentum and last year's low base, inflation is still high.

"Growth remains moderate and will remain constrained going ahead, but high

India can grow by 8-9% with reforms: Singapore PM

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ndia has the potential to grow at 8-9% over the next 5-10 years by focusing on its intrinsic strengths and taking the Opposition on board to push economic reforms, said Singapore Prime Minister Lee Hsien Loong today.

 

"India would be able to grow not just at seven per cent, but 8-9% for another 5-10 years easily,

Indirect tax collection below target, up 13.8% in April-June

Indirect tax collections during the April-June period rose by 13.8 percent to over Rs 1.07 lakh crore, much slower than the targeted 27 percent  growth for this fiscal.

“The overall indirect tax figure for April-June 2012 stood at Rs 1,07,959 crore,

Govt should restrict exercising ownership rights in banks: RB

The Reserve bank  expressed concern over the government “occasionally exercising” its ownership rights in banks and financial institutions through channels outside of their boards, and asked it to show exemplary corporate governance.

“There are questions about how the government will play out its ownership role.

IIP OK, but forget about a rate cut

The Index of Industrial Production (IIP) number for May shows a 2.4 percent growth, against a contraction of 0.9 percent in the previous month. This is above what the Street expected—around 1.8 percent—but a closer look at the figures suggests there are still several pressure points which continue to plague the India growth story. Those hoping for another round of monetary easing by the Reserve Bank of India (RBI) will have to wait longer as a rate cut on 31 July, when RBI meets again for its quarterly review.

On a sectoral basis, mining was broadly unchanged, down—0.9 percent, manufacturing rose 2.5 percent, led

Little Q1 growth seen for TCS, Infosys

(Reuters) - Uncertainty about spending by U.S. and European clients in a weak global economy will likely weigh on the earnings of Indian outsourcers, dampening hopes that demand will pick up in the second half of the year.

India's $100 billion-a-year information technology and back-office outsourcing industry

Govt mishandled GAAR, scaring foreign investors: Sinha

Amid controversies over Vodafone tax matter and GAAR, BJP hit out at the government saying it has mishandled these issues creating scare and uncertainty among the foreign investors.

The main Opposition party suggested that Prime Minister Manmohan Singh 

Euro Near 2-Year Low Before Region’s Production Data

The euro traded 0.2 percent from a two-year low before data forecast to show inflation slowed in Germany and manufacturing stagnated in the euro area.

The 17-nation euro declined to a one-month low against the yen after as Germany’s top court said a decision on whether to suspend

RBI sells $1.26 billion in forex market in May

The Reserve Bank of India’s (RBI) dollar sales were higher in the foreign exchange spot market in May than in April, data from the central bank showed on Tuesday.

The RBI sold $1.26 billion in May compared with $275 million in the

IIP likely rose to 1.8% in May, more weakness ahead

India’s industrial output accelerated to a modest pace in May on an annual basis from barely any growth at all in April, held back by deep contractions in capital goods, a sign that the pace of overall economic growth remains weak.

A Reuters poll of 30 economists conducted between July 2-9 showed India’s Index of Industrial Production

Black money: Why is India doing private deals with tax cheats?

Why is  India privately closing tax evasion cases by letting Indian Swiss account holders pay their dues on the quiet  without formally announcing a voluntary disclosure scheme?

According to a Bloomberg report, an  amnesty offer is being made to 100 wealthy Indians on a list of 700 citizens with HSBC accounts in

India, China show strong signs of eco slowdown: OECD

India and China, two of the world’s fastest growing economies, are witnessing strong signs of slowdown, while most of the developed nations are seeing moderate growth, according to Paris-based think tank OECD.

The Organisation for Economic Cooperation and Development (OECD) today

Macro-economic stability will ensure low-cost housing: RBI

Against the backdrop of banks showing reluctance to provide loan to real estate, RBI said it has been following a cautious policy to ensure sustainability and viability of the housing sector.

“Our main focus is to maintain macro-economic stability. If there is

FDI in single-brand retail: Govt likely to relax local sourcing and brand ownership norms

The government is likely to relax local sourcing and brand ownership norms as part of a comprehensive review of the FDI policy for single-brand retail to address concerns of foreign companies, even as a senior government official ruled out the possibility of an IKEA-specific package.

The Department of Industrial Policy and Promotion(DIPP) official, who did not wished to be

US mkts end lower as major central banks cut interest rates

The US markets closed marginally lower in thin trading after a round of interest rate cuts by major central banks and as investors remained cautious ahead of Friday's key government jobs report.

On economic data front, weekly jobless claims dropped 14,000 to a seasonally

ECB rate cut not enough to keep markets satisfied: Lloyds

Trevor Williams, chief economist, Lloyds, says that after Draghi's comment bond yields are up almost 30 bps. Although the rate cut of 25 bps, which brings the ECB rates to a record low of 0.75%, is not satisfied to keep the markets satisfied. The markets are more worried after Draghi comment.

Q: The market was expecting non-standard measures but the ECB has refrained from announcing anything. Will this have any significant impact?

A: It has already impacted the markets. After Draghi's comment the bond

Firms see India 3rd most-favoured destination: U.N. report

(Reuters) - Major global companies consider India their third most favoured destination after China and the United States, a U.N. report said on Thursday, and investment inflows could increase by more than 20 percent both this year and next.

Foreign direct investment (FDI) flows into India leapt 30 percent to nearly $32 billion in 2011, though held

RBI to continue buyback of foreign convertible bonds

The Reserve Bank of India would continue to buy back foreign currency convertible bonds (FCCBs) issued by Indian companies under the approval route, it said today.

The central bank will consider proposals from Indian companies for

There will be no arbitrariness in tax matters: PM

Against the backdrop of the controversy over Vodafone tax issue, Prime Minister Manmohan Singh today sent out clear signals to foreign investors saying there will be “no arbitrariness” in tax matters.

“We want the world to know that India treats everyone fairly and reasonably

Is rupee’s sudden dream run sustainable?

The rupee is on a sudden dream run. The currency rose 5 percent, according to reports, in four day flat.

It hit a life-low last week and also rose to seven-week high, all in a week’s time.

Volatility is the rule of the game in the foreign exchange