The last column of every year typically deals with the year that was. I would have loved to do that. By any yardstick, 2018 has been a tumultuous year for Indian banking.
The CEOs of bad debt-laden state-owned banks should start partying, thanks to the early arrival of Christmas after a stressful year, relentlessly chasing rogue borrowers for recovery of the money lent. Last week, Finance Minister Arun Jaitley played Santa Claus for them by seeking Parliament’s approval for Rs 410 billion capital infusion in these banks. The government had budgeted for Rs 650 billion fund infusion during the current year, of which Rs 420 billion is still to be allotted.
Dear Governor, The day you took over as India’s chief money man, you tweeted: “Assumed charge as governor, Reserve Bank of India. Thank you each and every one for your good wishes.” A few days later, after the board meeting, you tweeted again: “Good meeting of RBI central board.
The US Federal Reserve periodically holds “open” board meetings. Typically, it begins at 10 am at the Marriner S. Eccles Building on 20th Street and Constitution Avenue, NW, in Washington DC.
The fifth bi-monthly monetary policy statement of the Reserve Bank of India (RBI) had no surprise as the central bank’ action — or, the lack of it — has been on the expected line but going beyond the statement, for the first time, Governor Urjit Patel and Deputy Governor Viral Acharya have given guidance to the markets. At the post-policy interaction with the media, Patel has said if the upside risks to inflation do not materialise, there is a possibility of space opening up for appropriate RBI action. This clearly means that the Indian central bank is not ruling out a change in stance (to neural) or even a rate cut.
On October 5, when the Reserve Bank of India (RBI) announced its last bi-monthly monetary policy after a three-day meeting of its monetary policy committee (MPC), the rupee touched a low of 74.22 to a dollar, before closing at 73.77.