Marginal cut in Small Savings interest rates

In a panel discussion on Monday, at the annual national interest reset discussion, the new interest rates for small national savings schemes have been announced.

As per the recommendation of panel members, the interest rates on small saving schemes have been reduced by 10 basis points or .1% compared to previous years.

The RBI annual interest reset panel was headed by RBI deputy governor Shaymala Gopinath. The new interest rates will be effective form April 1, 2013.

The new interest rate values are –

1) Public Provident Fund (PPF) – interest rate lowered from 8.8% to 8.7%

2) National Savings Certificate (NSC) – interest rates lowered from 8.9% to 8.8%; both on twenty and five year maturity schemes

3) Senior Citizen Saving Schemes - interest rate lowered from 9.3% to 9.2%

There will be no change in interest rates on one year deposit schemes. As per the statements of Planning Commission deputy chairman Montek Singh Ahluwalia, the new rates will be more favorable to depositors in this inflation season.

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RBI cuts repo-rate and CRR by 25bps

The Reserve Bank of India has cut the interest rate by 25 bps on Tuesday, as speculated. The Cash Reserve Ratio was also cut to 4 per cent from 4.5 per cent, by cutting down 25 bps.

The RBI has also cut the repo-rate by 25 basis points to 7.75 per cent from 8 per cent, for the first time since April 2012. The ease in the monetary policy will boost the Indian economy.

The cut in CRR will help to infuse around 1.80 billion rupees into the economy.

Speaking to media, the governor of RBI, Duvvuri Subbarao told that the soften in the headline inflation was the major factor leading for a cut in the interest rates by 25 basis points.

The headline inflation was at 8.1 per cent in the September 2012 and dropped to 7.2 per cent in December 2012.

The GDP was recorded 5.5 per cent in the first quarter and dropped to 5.3 in the second quarter.

The stock markets - BSE Sensex and NSE Nifty gained following the rate cut declared by the RBI.

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SBI hikes Int Rate on FDs

Business News: The State Bank of India (SBI) has hiked the interest rate on the short term fixed deposits up to 1 per cent. Now the deposits of seven to 90 days will attract interest of 10 per cent, and similarly the deposits for a the period 91-197 will get 9.75 per cent and 8 per cent on the fixed deposits for 181 to 1 year. The hike in the interest rate will be effective from 28 March 2012.

However, the impact of hike in the interest rates on fixed deposits weighted high on the shares of the State Bank of India, the indices fell by 1.62 per cent at BSE Sensex on Wednesday.

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SBI hikes Lending Rates by 50 bps

State Bank of India (SBI), the largest bank of India, raised lending rates by 50 basis points to 10 per cent on Thursday. Now the home, auto and corporate loans from the SBI will be costlier.

The hike in the base rate will come into effect from August 13, according to a statement issued by the bank. The bank hiked the benchmark prime lending rate (BPLR) by 50 per cent to 14.75 per cent.

Last month, the Reserve Bank of India had hiked the repo and reverse-repo rate while kept the Cash Reserve Ratio (CRR) unchanged. Since March 2010, the RBI hiked the key interest rates 11 times to tame the soaring headline inflation.

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RBI hikes Key Rates 11th time, Repo Rate to 8%

Going against the appeal of the bankers of India, the Reserve Bank of India has hiked the key rates for 11th time to check the high headline inflation in India. The inflation was recorded 9.44 per cent in June and 9.06 per cent in May. The move is however bit necessary to check the inflation trajectory weighing high on Indian economy.

The RBI raised the repo rate to 8 per cent and kept the cash reserve ratio at 6 per cent, unchanged for the banks. This will make the loans like auto, home, personal loans dearer for the customers.

The hike in the key interest rates to have direct impact on the corporate earnings and capital investment too. The BSE yesterday responded heavily to the hike in the key interest rates by the RBI shedding 300 points. The RBI goes for the hike the rates 11th time dampening the economic growth rate.

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State Bank of India hikes Lending Rates by 25bps

In significant development, the largest bank of India State Bank of India has hiked the lending rates by 25 bps making the loans dearer for the customers.

The state bank of India has also hiked the deposit rates by 100bps or up to 1 per cent.

Most of the bank have hiked their lending rates following hike in the interest rates by the Reserve Bank of India last month.

The headline inflation was recorded at 9.06 in May 2011. To control the inflation in India the RBI has changed the interest rates ten times.

With the hike in the lending rate now customers need to pay more for their loans - home loan, auto loan, personal loan etc.,

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RBI Hikes Repo Rate to 5% and Reverse Repo Rate to 3.5%, Intereste Rates by 25 bps

RBI Hikes Repo Rate to 5% and Reverse Repo Rate to 3.5%, Intereste Rates by 25 bps

The Reserve Bank of India (RBI) has hiked the interest rates by 25 bps on Friday evening.


The hike by the RBI was unexpected, but the impact would be high on home loans and auto loans.

 Experts believer that the home loans and auto loans rates will go up following the hike in the interest rate by the Apex Bank.


The RBI has raised the benchmark short-term interest rates - repo (banks pay the repo rate to borrow from RBI) to 5 per cent from 4.75 per cent and reverse repo rates (banks receive parking surplus funds with RBI) to 3.5 per cent from 3.25 per cent. interest rate is the greatest instrument the RBI has to contain the inflation.

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Index of Industrial Production (IIP) grows; RBI may rise interest rates

Business News This Week: Index of Industrial Production (IIP) of India is grown by 11.7% in November 2009 comparing the figures of November 2008. The growth of 11 per cent is phenomenal. In 2009, IIP was recorded the negative slope and the growth record from the negative mark is indicating the sign of recovering.

With the growing IIP, the Reserve Bank of India, may consider to judge the current interest rates. The RBI will review its credit policy on January 29, 2010. These rise IIP may help RBI to hike the interest rates in the country, to contain the rising food prices and food inflation.

There are speculations in the market about RBI rising the interest rates. The stock market in Indian is responding well, there are hardly impact of sentiments on the stocks of late. The stock market also in positive strides. Hope this is the best time have of RBI to change the structure of the interest rates.

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After CRR, will interest rates rise?

The Finance Minister P Chidambaram said he does not expect an increase in the lending rates any time soon.

Briefing reporter after a meeting with PSU ban heads, the finance minister has said bankers were happy that the RBI had changed the Cash Reserve Ratio (CRR) and left the policy rates untouched.

The finance minister said loan growth by banks is likely to be slightly higher than the projection of 20 per cent by the RBI.

The RBI took anti-inflationary measures to bring the inflation under control and there were expectation from the banker that in this process the RBI may change the interest rates.

In its annual policy, RBI has increased the Cash Reserve Ratio which would result to drain liquidity system by Rs. 9,000 cr.

The policy is clear – an inflation was defined by best economists as ‘too much of money chasing too few goods’.

The central bank has tried to check the credit flow through the Cash Reserve Ratio, as banks need to keep Cash Reserve Ratio  as per the RBI direction, which would help to check the credit flow in the nation. And ultimately, it may help to check the supply of money into the market.

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