Monday, 11 August 2014

VRITTAM (03 AUG 2014 - 09 AUG 2014)

VRITTAM (03 AUG 2014 - 09 AUG 2014)


The Reserve Bank of India (RBI) has started discussions with the finance ministry on a new monetary policy framework, including measures to reduce retail price inflation. The RBI last Tuesday kept its policy rate unchanged for the third time in a row at 8 percent, and set a target to bring down retail inflation to 6 percent by March 2016. Finance Minister Arun Jaitley, who attended the board meeting of RBI in New Delhi, said the central bank would take a final call on its 6 percent inflation target by March 2016.

Foreign exchange reserves down $573.5 mn

The foreign exchange reserves declined by $573.5 million to $319.99 billion due to a sharp fall in the currency assets for the week ended Aug 1, Reserve Bank of India (RBI) data showed. According to the RBI's weekly statistical supplement, foreign currency assets, the biggest component of the forex reserves, fell by $1.09 billion to $292.69 billion for the week under review. The RBI said that the foreign currency assets, expressed in US dollar terms, include the effect of appreciation or depreciation of non-US currencies held in reserve such as the pound sterling, euro and yen.

Tata Steel shuts Odisha plant due to raw material crunch

Tata Steel Ltd (TISC.NS) has shut down one of its ferro alloys plants in Odisha due to a raw material shortage linked to the suspension of a mining license, the company said in a statement late on Friday. Tata Steel sourced ore for the 50,000 tonne-per-year Bamnipal plant from its captive chromite mine in Sukinda, operations of which were suspended in May. The plant was run with available inventory before being shut on Aug. 4. The suspension of operations at Sukinda and Bamnipal would mean more than 6,000 job cuts, the company said.

China excludes Apple from procurement list

China’s government excluded Apple Inc. (AAPL) iPads and MacBook laptops from a list of products that can be bought with public money because of security concerns, according to government officials familiar with the matter. Apple is the latest U.S. technology company to be excluded from Chinese government purchases amid escalating tensions between the countries over claims of hacking and cyberspying. China’s procurement agency told departments to stop buying antivirus software from Symantec Corp. (SYMC) and Kaspersky Lab, while Microsoft Corp. (MSFT) was shut out of a government purchase of energy-efficient computers.

The Finance Ministry said it cannot lower its guard on the external front and ease gold import curbs as developments in Iraq and other countries can have adverse implications on the country's Current Account Deficit (CAD) situation. CAD, which is the excess of foreign exchange outflows over inflows, touched a historic high of USD 88 billion or 4.7 per cent of GDP in 2012-13, mainly due to rising imports of gold and petroleum products. In order to check rising CAD, the government had raised import duties on the yellow metal to 10 per cent, while RBI imposed curbs on import of gold and also laid down various pre-conditions for inward shipments of the precious metal.
Reserve Bank Governor Raghuram Rajan today said 4.1 per cent fiscal deficit goal set by the government for the current fiscal is an "ambitious target". "4.1 per cent is an ambitious target. The government will achieve it if it does want. It has done before. But how it achieves it is what is important," Rajan said. During 2013-14, the fiscal deficit - the difference between the government's income and expenditure - was 4.5 per cent of the GDP.
He said India has capacity to bring the deficit under control provided there is improvement in revenue collection.

S&P: Wealth gap is slowing US economic growth

By The Associated Press of Standard & Poor's


6 trouble spots of Indian economy


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