Monetary policy 2009 10

261 views

Published on

1 Comment
0 Likes
Statistics
Notes
  • LA PERSONA QUE ME LO ENVIO ESTA TODAVIA ASOMBRADA DE LO OCURRIDO, YA QUE ELLA DICE QUE LO HIZO POR HACERLO Y QUE PIDIO ALGO QUE CREIA CASI IMPOSIBLE DE LOGRAR PROBEMOS. * Para ti mismo di el nombre de la unica persona del sexo opuesto con quien quieras estar (tres veces...)... * Piensa en algo que quieras lograr dentro de la proxima semana y repitelo para ti mismo(a) (seis veces)... * Piensa en algo que quieras que pase entre tu y la persona especial (que dijiste en el no. 1) y dilo a ti mismo/a (doce veces)... * Ahora haz un ultimo y final deseo acerca del deseo que escogiste. * Despues de leer esto tienes 1 hora para mandarlo a 15 temas y lo que pediste se te hara realidad en 1 semana. A la mayor cantidad de gente a quien lo mandes mas fuerte se hara tu deseo. Si tu escoges ignorar esta carta lo contrario del deseo te sucedera, o esto no sucedera jamas.............. Que tus días estén llenos de logros y tus noches de sueños copia y pega esto en 15 o + tema
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • Be the first to like this

No Downloads
Views
Total views
261
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
8
Comments
1
Likes
0
Embeds 0
No embeds

No notes for slide

Monetary policy 2009 10

  1. 1. Monetary policy 2009-10 • Stance – Ensure a policy regime that will enable credit expansion at viable rates while preserving credit quality so as to support the return of the economy to a high growth path. – Continuously monitor the global and domestic conditions and respond swiftly and effectively through policy adjustments as warranted so as to minimize the impact of adverse developments and reinforce the impact of positive developments. – Maintain a monetary and interest rate regime supportive of price stability and financial stability taking into account the emerging lessons of the global financial crisis.
  2. 2. liquidity • Need to withdraw liquidity once economy regains momentum • Fall in rates across tenures and market and not uniform • Liquidity situation improved significantly • Overnight rates have softened considerably • Multiple policy, prudential tools aided liquidity management
  3. 3. The global economy is showing increasing signs of stabilization • However, even as most of the forecasts on recovery are generally optimistic, significant risks remain. • The recovery in many economies is driven largely by government spending, with the private sector yet to begin playing a significant part. • There are signs that high levels of global liquidity are contributing to rising asset prices as well as rising commodity prices. • Emerging market economies (EMEs) are generally recovering faster than advanced economies. But they are also likely to face increased inflationary pressures due to easy liquidity conditions resulting from large capital inflows.
  4. 4. Domestic economy • India is facing rising inflationary pressures, albeit largely due to supply side factors. • Two, households, firms and financial institutions in India continue to have strong balance sheets, although there is a need to encourage domestic consumption and investment demand. • Three, since the Indian economy is supply- constrained, pick-up in demand could exacerbate inflationary pressures. • Four, India is one of the few large EMEs with twin deficits - fiscal deficit and current account deficit.
  5. 5. • Growth during Q2 of 2009-10, at 7.9 per cent, reveals a degree of resilience that surprised many • Public expenditure continues to play a dominant role and performance across sectors is uneven, suggesting that recovery is yet to become sufficiently broad-based. • For several months, rapidly rising food inflation has been a cause for concern. – the global rates are going to increase . The opportunity to use imports as a way to contain domestic food prices is, therefore, quite limited.
  6. 6. • The effective average lending rate of scheduled commercial banks declined • On the fiscal front, the stimulus by the government in the second half of 2008-09 has clearly contributed significantly to the recovery. • On the external front, exports have begun responding to the revival in global demand
  7. 7. • On a financial year basis, between April- December 2009, WPI moved up by 8 per cent. • The large stock of food grains with public agencies should help supply management. On the other hand, there is a risk that inflationary pressures may emanate from the rebound in global commodity prices.
  8. 8. Risk Factors • There is still uncertainty about the pace and shape of global recovery • Oil prices have been range-bound in the recent period. • Expectations of softening domestic inflation are contingent on food prices moderating. • As growth accelerates and the output gap closes, excess liquidity, if allowed to persist, may exacerbate inflation expectations. • as the recovery gains momentum, it is important that there is co-ordination in the fiscal and monetary exits. (govt borrowing has increased recently)
  9. 9. Monetary Measures • Bank Rate The Bank Rate has been retained at 6.0 per cent. • Repo Rate The repo rate under the Liquidity Adjustment Facility (LAF) has been retained at 4.75 per cent. • Reverse Repo Rate The reverse repo rate under the LAF has been retained at 3.25 per cent. • Cash Reserve Ratio 5.75 per cent of their net demand and time liabilities (NDTL) • Expected Outcomes – Reduction in excess liquidity will help anchor inflationary expectations. – The recovery process will be supported without compromising price stability. – The calibrated exit will align policy instruments with the current and evolving state of the economy.
  10. 10. Monetary Measures • Bank Rate The Bank Rate has been retained at 6.0 per cent. • Repo Rate The repo rate under the Liquidity Adjustment Facility (LAF) has been retained at 4.75 per cent. • Reverse Repo Rate The reverse repo rate under the LAF has been retained at 3.25 per cent. • Cash Reserve Ratio 5.75 per cent of their net demand and time liabilities (NDTL) • Expected Outcomes – Reduction in excess liquidity will help anchor inflationary expectations. – The recovery process will be supported without compromising price stability. – The calibrated exit will align policy instruments with the current and evolving state of the economy.

×